Sales Force Optimisation
CAN YOU STILL AFFORD YOUR SALES FORCE Optimisation IN IT’S PRESENT FORM?
The way it is now and has always been
If your company is like most others in your industry you will have a sales force structure headed up by a sales director, national sales managers, regional managers and then sales managers.
Under this sales management team will be your “road warriors”, possibly split between “hunters”(new business sales people) and “farmers”(account managers, relationship managers, key account executives etc.).
Does this structure make money and is it necessary?
The question is does it make substantially more money than it costs to run or could you in fact do without it…?
Asking your sales director will not get you close to answering that question because he or she has a vested interest in telling you that they are :-
Indispensable and that the sky would fall in if their operation wasn’t there.
We have been sales directors ourselves in a variety of UK and international businesses and will therefore have more experience and knowledge of best in breed global sales directional practices in salaried, part salaried, direct, indirect and commission only sales forces than most sales directors and will provide a transparent ROI focussed view.
The same applies to call centres, contact centres, telesales functions and customer service operations.
What are the figures your sales director would rather you did not know?
Each year the Management Consultancy Group PLC reviews productivity within the UK and global private sectors and across sales functions and a broad cross section of SIC codes.
The picture is far from pretty or satisfactory.
The UK’s private sector productivity is just 60% or put another way; UK business receives 132 days of work for every 220 possible working days leaving us 15th in the global league table of modern industrial nations.
Sales forces fare even worse with the average amount of face to face selling time set at just 10% or one half day per working week.
Just one salesperson in 250 consistently hits their monthly targets in America or the UK despite all the training, managerial effort and the presence of the sales director.
With call centres, customer service functions, telesales operations and contact centres the optimum that can be achieved is 75% (45 minutes) per telephone hour worked but the average is typically less than 50% and we at Transaction Focus (www.transactionfocus.com) have witnessed this figure to be as low as 11%…
Sales empires built on sand
Often this picture is disguised by business which comes into the company anyway, either directly through the switchboard or via the personal contacts of board members or business which comes in through the website but is turned into a sale on which you are probably paying commission as well.
On top of that you may be paying the sales director part of his/her overall remuneration in the form of bonuses which are based on this disguised business.
The question you should ask yourself is whether this is an acceptable situation for your company going into the future?
What can and should be done?
If we take it as a given that doing nothing is not an option what should be done?
We at Transaction Focus believe that the entire operation should be quickly and rigorously audited from top to bottom and the current operation needs to be optimised and future proofed within the form of a new sales and marketing target operating model.
This may well leave the existing sales director in place but operating at a much faster pace and delivering your company a far higher ROI.
In short, they will be earning their keep and as long as they do they retain their place.
Alternatively, the situation might warrant root and branch reform with a new sales director, an interim sales director supplied by us or a new self-determined work team structure with no need for any sales direction whatsoever.
Sales Force optimisation and what it can achieve
With a relatively minimal intervention solution provided by Transaction Focus, your sales force should reach a point without investment in technology whereupon productivity doubles to 20% or one day per week.
With sales force automation, geo-mapping software and CRM, this can be built to 30% and that’s before we even think about training them to be more effective and improve their “strike rate”.
Beyond that BPR and Business Process Innovation linked to TOC, OODA Loop and Japanese style continuous improvement will, in conjunction with our bespoke processes, shorten the sales cycle , make the sales force easier to manage, improve their ROI and improve your cash flow.
We look at sales force composition and compare it with your objectives so that changes can be made as necessary.
Your sales director thinks he/she can do a better job
In that case we put our money where our mouth is by splitting the sales operation into two under equal conditions and then competing directly with the half the sales director is in charge of.
We did this with Kimberly Clark and competed with their established sales operation after a few months.
We can do the same for you.
Sales and telephone outsourcing
It may be that you are trying to break into new markets, sell new products which may or may not cannibalise existing sales, or perhaps you are expanding overseas.
In each of these cases Transaction Focus can set up a seamless “white labelled” sales or telephone based operation which costs considerably less than your existing sales force with or without your incumbent sales director.
In addition the problems associated with discipline, performance and employment law are eliminated because they are assumed by us.
This can be in the UK or practically anywhere outside of the Americas.
JOHN A GELMINI MBA, BSc (Econ)(2.1)
John A Gelmini , an Associate Director at Transaction Focus, has worked in the area of sales direction, sales force and contact centre optimisation, outsourced sales and transformation for more than 22 years.