Companies that successfully weather turbulent times typically don't allow their sales strategies to remain constant. They tweak, modify, or even do a major overhaul if the competitive landscape and customer needs and buying behaviors change. The trick is knowing how much change is needed, what needs to change, and when to implement.
So how do you know if the time is right to modify your sales strategy? Here are a few questions to answer in making your determination:
How are your sales results? Are you growing at the expected rates? Are competitive pressures resulting in margin erosion? What does your customer retention look like? Are there new customer segments that you should be selling to but aren't?
What does the voice of the customer tell you about how clients view your company? Is customer satisfaction improving or declining? What are customers saying about the effectiveness of your sales team?
How are your salespeople spending their time? Is it focused on growing current client revenue, retention, new business with new brand names, administrative work, etc.? When was the last time you did a time study assessment to validate this?
Is 80 percent of your sales revenue still coming from the top 20 percent of reps? Are your most experienced and expensive field sales resources focused on the higher-value clients with more complex solutions, or do they migrate to the lower-value transactions that are easier to sell?
What do your sales managers and salespeople indicate are the top barriers to delivering more revenue? If they could wave the magic wand, what would they do differently?
Have you implemented a channel strategy to include inside sales? If yes, what is your expense-to-revenue ratio and ROI for this channel? Is it meeting expectations?
Are you utilizing VARs, resellers, or brokers to help you cover the market more effectively? If yes, how effective is this channel? If no, what has prevented you from moving in this direction?
Do not shortchange your assessment by avoiding any of the above questions. Doing so could result is too little or too dramatic of a change to your sales approach. Either can be detrimental. If you have the internal capabilities to do this assessment, great. If not, this is where a consultant or firm with expertise in sales coverage strategy can add great value in your diagnosis. Sometimes being too close to the situation has its disadvantages.
Once you do a complete assessment, it may indicate that you would benefit from changing your sales strategy. You then need to analyze the following areas:
•Which customers and prospects should you be selling to? Which ones yield profitable margins today? This requires a segmentation and targeting exercise, as your sales force may need to target different types of customers.
•Do you have new markets you want to penetrate? The current value proposition may not be appropriate for this segment and may not align with customer needs.
•Is your sales process yielding the desired results? Are reps adding value throughout the selling cycle? What activities are your top 20 percent doing that isn't being done by the rest of the sales organization? What changes are required and what training is needed to implement a new or modified sales process? In other words, how do you move your organization up the value chain in selling skills?
•Do you need to create a new sales group that will focus on different areas? Does a hunter/farmer model make sense? Has your sales force become too generalist, without deep knowledge required, or do you have too specialized of an organization? How are you leveraging inside sales to help sell less complex solutions and generate qualified leads for the field reps?
The next important step is implementation of the new change. This is where most organizations fail. They don't spend enough time developing the details around how to make the new processes work. Oftentimes, there isn't buy-in across the management ranks. The company may not take the time needed to gain train the leaders as to what new behaviors will be required. It then becomes the "program of the month" instead of instituting cultural change.
Before implementation, ensure you have the appropriate buy-in, understand who the early adopters will be, and validate that compensation is aligned with the new roles. In addition, make sure you have the ability to track the new metrics needed. Technology plays an important role, as well.
And lastly, don't skimp on training everyone impacted by the new changes, as well as your customers.
Mary Donato is president of Applied Principles and associate director of the Institute for the Study of Business Markets. She can be contacted at firstname.lastname@example.org.