No More Foot in the Door
Nigel Piercy and David Cravens, The Independent (London, England)
The salesforce remains the biggest employer of marketing personnel and for many companies by far the greatest marketing cost. This places the highest priority on getting maximum effectiveness from the salesforce, particularly at a time when major customers are reducing the number of their suppliers in the search for the "lean" supply chain, and there is pressure of international competition in many markets. Companies are increasingly aware that improving salesforce performance offers a major opportunity to enhance both top-line (sales) and bottom-line (profit) performance.
The result is that selling has changed from simply hitting targets. The pressure is on to become the preferred supplier by knowing the customer's business and proving that you offer added value. The focus for managing salesforces has become the collaborative and sustainable customer relationship.
As part of an international programme of studies into sales effectiveness, Cardiff Business School has investigated the hallmarks of truly effective sales organisations in the UK, with some surprising results. These new insights into the problems and achievements of sales managers and directors suggest a very different agenda for managing sales operations effectively. Pinning down what effectiveness means has always been a problem. We took a very simple view: effective sales organisations are those which do better than their competitors in sales, market share, profitability and customer satisfaction, and which beat their own company objectives in each of these areas. The research was based on a 150-item questionnaire sent to nearly 150 companies. The first point to make is that there was nothing marginal about the differences between the more and less effective sales operations - the differences were massive. It was also clear that the leaders were ahead on all the measures of effectiveness - they were not buying success in customer satisfaction at the expense of sales and profits. This is because customer satisfaction drives sales and profits, not the other way around. The critical differences which marked out the most effective sales organisations from the rest were: l their overwhelming focus on developing and fostering customer relationships; l their efforts in managing the key drivers of salesforce performance; l their salesforce compensation strategy; l their ability to recruit and develop salespeople with several important success characteristics; and l the critical role of the salesforce manager on the front line. Together these hallmarks of the effective sales organisation lead to a substantially different agenda for recruitment and development in the salesforce, for managing selling efforts, and for achieving the customer relationships that lead to competitive advantage. The focus on long-term customer relationships in the most effective sales organisations cuts across everything else that we found and underpins their dramatically superior results. Salespeople in the effective sales organisation perform better in sales, margins, exceeding sales targets and objectives. Yet we found that traditional sales presentation skills and technical product and service knowledge were no different in the most effective sales organisations than in the rest. The critical drivers of superior salesforce performance were: l adaptiveness in selling: flexibility in sales approaches, variation by customer and experimentation in selling methods; l teamwork in selling: collaboration within the salesforce and with non- selling personnel elsewhere in the company, crossing organisational boundaries to meet customer requirements; l sales planning: developing sales strategies around customers as well as effective day-to-day activity planning; l sales support activities: providing customers with after-sales support, complaints-solving and troubleshooting on customer problems. …