- November 7, 2006
- Posted by: Dave Kurlan
- Category: Understanding the Sales Force
When we evaluate a sales organization we always identify an individual who has the best skills. This often creates controversy because the individual with the best skills is hardly ever the best producer.
There is precedent for this phenomenon.
Take the weather: The sunniest days are not always the warmest, snowiest days are not always the coldest and cloudy days are not always the most unpleasant.
Next try human relations: The most attractive people are not always the nicest people, unattractive people are not always the least popular, and the most popular people don’t always have the deepest relationships. In selling, those who are best at relationships aren’t always the best salespeople.
When we evaluate the salespeople in sales organizations we regularly see two scenarios that companies find most surprising. The first, as mentioned above, is the skilled salesperson with mediocre results. The second is the successful producer with little in the way of skills. Since both scenarios have multiple explanations, I’ll attempt to explain them in the tables below:
Here’s another way of looking at the skill sets of salespeople and their resulting performance:
Few Skills Many Weaknesses
Many Skills Many Weaknesses
Few Skills Few Weaknesses
Many Skills Few Weaknesses
Perhaps you can see why the salesperson with the best skills is seldom the best producer. In the four scenarios where the salesperson has good skills, he is a great producer in only two of them; where the skills aren’t neutralized by many weaknesses, and where the business is easier business to generate because of either renewals or call-ins.
How important are selling skills? They’re very important but not nearly as important as eliminating the weaknesses that your salespeople have.
It’s also important to measure sales effectiveness equally for all salespeople. Do you have some salespeople who have to go out and find the business while others rely on existing business or call-ins? How can you level the playing field so that you’re rating your salespeople in a meaningful way?
Rather than dollars, how about points?
If it’s three times as difficult to go out and find business as it is to take renewals or call-ins, then you could award 3 points for every piece of business brought in the old-fashioned way compared to 1 point for business that comes in the easy way. Using that approach, we could develop the following table:
# of Sales
You’ll notice that with this approach, John has more points than Bill even though Bill had four times the revenue as John. But which salesperson actually grew your business? Bill’s business was with existing accounts who probably represented 85-90% of that total last year, while John probably found $638,000 that didn’t exist last year.
Lesson: It is all in the numbers but you have to look beyond the revenue and determine how that revenue is being generated, by whom, and the underlying reasons for those results. Evaluating your sales force is the most powerful way to get that insight.
©Copyright 2006 Objective Management Group, Inc.