selling

Talent Management lessons learned for Sales and Human Resources leaders.

Over the years I’ve been involved in a number of projects which included making use the Challenger approach published by the Corporate Executive Board (CEB). The initial projects were started soon after the white paper on “Challenger ™” selling was published in 2009 so a lot of the methods used were custom developed. Today the range of Services from CEB’s Sales Effectiveness Solutions team address these issues and can help clients with the change management actions required. Details of the client and location are not included in the observations below for confidentiality reasons.

The problem:

A team of 23 sales people and 4 managers were underperforming against sales targets, and the problem had existed for quite some time. The team’s sales results were flat for 3 years in a market which was expected to grow 10%+ per annum. We were bought in by the executive sponsor to diagnose and recommend an approach to address the issues. We undertook an analysis of each individual, focussing on their professional history, results over 3 years, 360 degree feedback, sales effectiveness within their current pipeline and account planning. Issues existed across just about every important topic ranging from internal alignment, key account management, selling skills, coaching, performance management and front line sales management. As we worked towards a view of each individual we used the data to categorize each person according to the 5 sales person profiles published by CEB. Our conclusion was the team consisted of 3 challengers, 2 lone wolves, 5 hard workers and 13 relationship sales people*. All 4 of the managers were relationship oriented, and none demonstrated the innovation and coaching skills required to land big deals. The 2 lone wolves who were recent hires, had entered the organization as challengers in our view, but due to their discomfort with the organizations culture and leadership, they had distanced themselves from interacting with others and morphed into lone wolfs. The 3 challengers were the only individuals ahead of their YTD sales revenue targets.

Actions taken:

We had no choice but to set expectations with the executive sponsor that i) this was going to take at least 12 months to fix; ii) the sales team had no chance of making their full year numbers and iii) we needed to start by replacing the sales managers, all of whom were long time employees.  This generated many long and difficult executive discussions, but the problem was so clear and substantial there was little else we could suggest. The CEB Challenger™ research and evidence was critical to explain the issues.

With approval in principle we proceeded with a turnaround plan which in the end took 2 years to reach the stage where more than 50% of the sales team were ahead of plan. The Challenger™ Sales model was the central theme of the new sales model and we focussed heavily on embedding this thinking in all talent management activities, cross team collaboration and account strategies. We replaced all the sales managers, hired or transferred in 10 new sales people. We took special actions to retain the 3 challengers and convert the lone wolfs to challengers. We succeeded in retaining all but 1 of these people.

With new sales managers we drove efficiency and effectiveness changes, and cross-team collaboration to a level of accountability the division had not experienced before.  We deliberately selected new sales managers from outside of the organization with proven track records in coaching, and the capability to innovate with customers. The on-boarding of the sales managers was a critical success factor and it was through these people that we drove the change.

Outcome:

We didn’t set world records, but the brand value of the division substantially improved. People from other groups started applying for sales roles in this division. The average revenue per sales person increased by 1.5X after two years; and approximately 50% of the sales team achieved at least 100%+ of their annual sales targets.

Tips & Lessons learned:

The following lessons learned are not intended to offer a comprehensive answer to every action an organization should take. This is a list of the actions we took which were critical to the result or, that we wish we had approached in a more comprehensive manner on this specific project.

1. Any project which involves driving sales growth starts with a clear executive decision and the front line sales managers are a key part of the strategy and solution. If the sales managers need help, then this is priority number 1 for the project. The chapter called “The Manager and the Challenger™ Selling Model” in The Challenger™ Sale* book published by CEB provides terrific insights and evidence to support this point.

2. We created our own capability profile of a Challenger™ sales person inside this division. Broadly we defined the management fundamentals every sales person should use to maintain sales disciplines; the emphasis on teaching, tailoring and taking control as the basis for selling; selling new ideas to customers, and the skills required to be an effective collaborator for big deals.

   The vocabulary we used was aligned to HR job descriptions and competency profiles. We made the topics listed in this capability template the criteria for hiring, individual and group education. A lot of the methods and dashboards we developed were tailored to this division because the rest of the organization was growing efficiently.

3. Selling the promise of gain internally and obtaining executive sponsorship from the divisional leader, the HR leader and product management was critical. We used the CEB published research material as our evidence. It became very obvious to the executive sponsor early in the project that the success of the transformation would require substantial changes in accountabilities and value delivered across the entire division and not just the sales team. We celebrated individual progress every month at team meetings, and attempted to make the Challenger™ sales model a key element of the team’s thinking and culture.

4. The Challenger™ model scales across both complex and simple sales. For those sales considered simple, the demand generation team has a pivotal role to create a portfolio of ideas and value which appeals to multiple customers. Our account plan and customer loyalty metrics changed to include insights on strategic issues, how we could help and the return on investment from our ideas.

5. It is possible to train people to become Challengers, although those who are focussed relationships with customer decision makers who also believe this is important proved to be the most difficult to change.

   For annual planning purposes the 5 sales person profiles are helpful when attempting determining sales territories for simple and complex selling.

The quality of the insights and ideas in the Account plans generated by the team in year 2 were one of the most personally satisfying outcomes of the project. At that point I believed we had changed their behaviour.

Recommendations if you are planning to address similar sales talent issues:

1. If you have systemic performance issues, then be careful to accurately diagnose and separate the root cause issues from the symptoms. I have found CEB’s Anatomy of a World Class Sales Organization* is an excellent template to use for this purpose.

2. Once the changes are launched, the Sales manager should create a personalized skills development and coaching plan for every sales person to help them through the Sales Model changes. Group education is unlikely to address all of the issues.

3. All new product launches should be aligned to the Challenger™ Sales model and vice versa. New products are tipping point opportunities to create business breakthrough ideas for customers. The Challenger™ sales model is a key lever to help average performing sales people to participate and drive sales of new products.

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The Business case for Change: Lessons learned for the Sales Leader

When the Challenger™ insights are applied correctly, the upside impact on a company’s growth strategy can be significant.

Every company’s circumstances are different, but at some point a Sales leader needs to ‘place a bet’ on which brand and selling techniques they will use to develop their sales organization. In my view you should place that bet on the Challenger ™ thinking from The Corporate Executive Board (CEB). The purpose of this article is to provide some lessons I learned when placing that bet, to assist the sales leader who is preparing the business case for a Challenger ™ project.

Is there a Case for Change?

Yes. But implementing a Challenger™ project is a big bet, so the business reasons need to be compelling. I don’t doubt you have a lot of data which highlights your issues and identifies the case for change. But this is a strategic decision, and if you are accountable for the numbers then the CEO will rely on your knowledge, judgement and willingness to make a personal big bet on this project.

Business case and executive alignment

Execution is everything but there are some lessons I learned during the planning phase which on reflection made the execution a lot easier. And I’ve included some thoughts which after reflection I wish we had placed a higher priority on. You might conclude many of these are common sense. They are. And they are critical.

Business Case:

• The business case and any working capital investments need to be justified. If you believe the anticipated sales growth is clear, then a straight line revenue growth and a lower SG&A % over a defined period of time may be possible. My own view is a ‘Real Options’ financial model is more realistic because the quantified outcomes, tactics and how long it will take will change over time. You will learn as you implement, and new organizational ideas will surface so you need the support of the CEO and CFO when this occurs. As long as the financial baseline you are committing to is achievable, then it’s better to be honest and realistic when setting expectations. Define the actions and milestones in return for a committed budget for a committed period of time and a committed review cycle. And above all, focus on measures which demonstrate improvements in the average sales person’s results. This is where the biggest impact exists.

• You may need to convince the leadership team that a strategic change in the allocation of working capital is required. For most companies I know, the working capital for a sales organization is dedicated to the training and implementation of sales productivity systems (e.g. CRM, Forecasting, pipeline management). Given this, and the resistance of the broader leadership team you may need to use data about the changes in buyer behaviour to explain why you believe allocating working capital to help sales people to develop original and authentic ideas for their customers is now as important if not more so. Get ready for a debate.

Executive Alignment

• A Challenger ™ project will not just impact the sales organization. It will impact your entire organization so have the right executive sponsors in place to support the changes and drive cross team collaboration. It’s quite possible your organizational dynamics and culture will change. I’d have your brand strategy and HR leads involved to ensure you manage the changes and ensure everyone across the organization benefits from the project.

• As the executive sponsor, your messages and actions will be critical. Define the business priorities and your sales manager’s commitments, make these transparent to the organization. As input to defining these commitments, read and re-read the Manager and the Challenger ™ Sales model in “The Challenger ™ Sale”* book. Make sure your sales managers are ready and armed with the skills to implement the recommendations.

Implementation:

• If you are implementing Challenger ™ ‘mid-flight’, then start small, prove it, and accelerate to scale. Don’t be afraid to run multiple, sequential pilots across sales teams, deal types and customers if you have a large team.

• The Challenger ™ Sales Model can be applied to both complex and simple sales. The sales people should take the lead to generate the original and authentic ideas for key account customers and big deals. And the marketing team should take the lead to generate the customer insights and value statements for the sales teams involved in selling repeatable solutions to multiple customers.

• The biggest improvements are likely to occur with your average performing sales people. Your sales managers need to be armed with the right coaching tools and framework to encourage this change. The adoption by sales people to teach, tailor and take control will improve their capabilities during the sales cycle in 4 areas:

  1. The research, insights and planning by  the sales person should be focussed on developing an original and authentic ideas which they can proactively market to their customers;

  2. Presenting the idea proactively will encourage the sales person to prepare and think deeply about their customer’s environment and the competition;

  3. Being humble enough to realise they may not have all the answers, a sales person should be encouraged to brainstorm and further strengthen the idea with the client’s input. This creates a competitive advantage;

  4. You may uncover a new ‘last step’ in the sales cycle for sales people….to fully integrate this approach with the rest of the organization I believe the sales team should be accountable to document the lessons learned after the contract is  delivered. These insights can be harvested by the Product R&D and Marketing teams to provide a rich vein of insights for cross team collaboration. But you might find the greatest untapped potential is when these insights are used to strengthen the link between your company’s corporate strategy and real evidence on the market’s direction based on why and what your customers are buying. Just imagine what your world might be like if your product R&D organization had 10 buying and selling insights on every customer you sold to last year?

If teach, tailor and take control are selling capabilities you want all your sales people to adopt, then be ready to redefine the measures you use to define a sales person productivity.

Possible follow up actions:

• Make sure you have the full support of your executive leadership team and your front line sales managers have formal commitments in place to support the project.

• I would not hesitate to get CEB and the Sales Effectiveness Solutions team involved to help you with ideas and insights to build your business case. They have a lot of evidence as the number of adoptions increase, and potentially can assist with the implementation.

• Be ready for a strong response from your competitors.