Sales Effectiveness: 5 Fundamentals That Drive Revenue
The expectations and challenges faced by sales teams have always been significant and in the last 18 months, those challenges have only increased. Teams have been required to drastically pivot how they operate for organizations to remain relevant, manage new obstacles, meet evolving customer needs, and ultimately increase revenue.
While teams’ approaches to prospecting and customer penetration may have changed since the pandemic, one fundamental thing has not: the basic elements of sales effectiveness. When a sales organization has a strong process for testing and measuring their effectiveness, innovation is easier – because they can quickly identify what is working and what is not and adjust accordingly.
The key to driving improved revenue results is to understand exactly where specific bottlenecks are impacting overall sales performance. Regardless of the challenges your organization may be facing, the 5 elements in Cosgrove Partners’ Sales Effectiveness Framework will help drive focus in the areas that will directly impact results.
For a sales professional, there is arguably no more important skill than the ability to articulate the value that your product or solution creates and differentiate your offering from your competitors. Strong sales messaging requires a deep understanding of your customer and his needs, robust competitive intelligence, and a strong grasp on your organization’s differentiators. Together, these things create messages that resonates with the customer on a deeper level than just the products or services that you sell, positioning you as a true solution to a business problem he is facing.
When strong messaging is not in place, salespeople are unable to articulate the value proposition that is most relevant to your customer and how it differs from competitors, leaving price as the only grounds to negotiate upon. This resorting to “price-based” sales ultimately results in extended delays in the sales cycle and fewer, less profitable deals.
Organizations should bring together sales, marketing, service, and leadership teams to develop messaging by customer segment and solution, fleshing out the ways each offering creates value for each segment. The goal of strategic sales messaging is to position your company as the only option that is uniquely qualified to meet a customer’s needs. Messaging should continue to be refined over time with new competitive intelligence, additional customer insights, and changes in the marketplace.
A successful sales organization is made up of individual sellers who have each been intentionally coached, developed, and thoughtfully assigned to their roles. This ensures that each employee understands what is expected of them and feels competent in reaching (and exceeding) those expectations.
Sales teams that fail to assign clear job requirements experience significantly higher turnover levels. Not only is this expensive to the organization as a whole, but it also results in countless lost revenue opportunities. With sales being so reliant on personal relationships, rapport building, and “tribal” knowledge, when a salesperson leaves your organization, they take priceless revenue potential with them.
To support the long-term fit and growth of your sales team, develop competency models that precisely fit each of the sales roles and their expectations. These models should contain a set of benchmark proficiencies that will allow sales leadership to measure the effectiveness of individuals and identify areas to coach and develop sellers. Consider also developing a recruiting profile and interview guide that compliments this competency model, ensuring that new employees enter your organization with the best chances for success.
Many times, sales organizations fail to reach their revenue targets not because of a lack of talent or weak value proposition, but simply because the behind-the-scenes systems driving the sales process are faulty. When you peek behind the curtain of the sales teams that are exceeding their targets, you will often find a set of clearly defined sales and management processes that are driving everything they do.
Creating and establishing new processes can be tedious and challenging; many salespeople are very comfortable doing things as they always have. However, inconsistent sales processes will always result in inconsistent results: inaccurate forecast revenues, poor qualification, and lower close rates. Performance without process is impossible to scale.
Invest the time and energy in standardizing your organization’s processes, from lead generation to deal signing. Establish a clear and repeatable lead generation process, a system for effectively qualifying leads, and a well-defined pipeline engagement plan that each salesperson feels confident executing against.
A large portion of selling is done independently; while your team may collaborate often, ultimately deals are closed based on a one-to-one relationship between seller and customer. This can make it especially difficult to monitor productivity of sales organizations.
Unfortunately, this can result in sales leaders being unaware of excessive time spent in non-customer facing activities and lack of focus on key areas, resulting in lower revenue per salesperson and, subsequently, lower close rates across the board.
In addition to the competency models for each role in the sales organization (see Organization above), it is important that leaders are also directing the focus of teams on the highest-value activities. These activities should be data-driven targets, informed by customer research, selling time, and competitive intelligence. Ensure sales leaders have access to rich data and analytics to guide their goal setting. For instance, 3 of your 10 customer segments may be responsible for 50% of your revenue; therefore, teams should be prioritizing these segments rather than spreading focus equally across all of them.
Sales leaders set the tone for the entire sales team. They are responsible for setting goals, developing sellers, and driving the organization forward. When leadership is underdeveloped or disengaged, performance is too: you will see higher turnover, lower morale, increased costs, and a significant loss of revenue.
As with leaders in any area of an organization, it is critical that sales leadership are advocates for the company culture and values, using these as their “North Star” for leading the team. They should also routinely travel with salespeople in order to offer effective, timely coaching in order to develop their team while also providing valuable insights that direct their goal and priority setting. A manager’s priority should be managing, too much time spent on administrative tasks reduces effectiveness.
Sales leadership is also responsible for driving cross-company alignment. This means ensuring integration between marketing, inside sales, outside sales, and service. Be sure that interdepartmental collaboration is a key part of the sales leader’s operating rhythm to share insights and address gaps or breakdowns in existing processes.
Consistent revenue and margin growth is the biggest challenge senior executives face in today’s market. While one would instinctively say that high performance in sales is primarily about revenue, it is also about the strategies, methods, and business practices an organization commits to in pursuit of long-term customer and shareholder value. Building a high-performing sales organization is a systematic process.
Closing high-value deals with large, complex customers requires a consistent, scalable sales methodology and sound business processes. These customers require more critical thinking, more effort, more planning, and more preparation. While most sales professionals want to win this business, they often don’t know how to work through the myriad of issues involved with complex sales. By focusing on these 5 fundamentals, organizations can identify these issues and address them systematically in order to improve results throughout the pipeline.
Cosgrove Partners specializes in developing systemic approaches to improving sales effectiveness and sales performance for our clients. If you’d like to learn more about how we can help your team see improved results, schedule an advisory call today.