As organizations grow and evolve, commercial functions like sales and marketing often become too complex. When organizations acquire too many different companies or develop too many different products, the sales organization becomes a collection of specialists with incentive to push their own agenda. As a result, organizational structure can be complex, overlapping, and ineffective. Reducing the complexity of these organizations improves employee experience as well as the customer experience – and the bottom line.
As sales stagnate or as customer satisfaction plateaus, it is imperative that organizations examine the design of their commercial organization. They must consider ways to streamline and better organize complexity to deliver value to customers, align team members’ efforts and incentives.
Clarifying Roles Improves Productivity and the Employee Experience
A few years ago, I was working with a successful company. Over time, a sales leader noticed that most sales people hit their sales bonus quotas without breaking a sweat. On one hand, this was not a problem: everyone was selling and hitting their targets. But the trend also made her wonder: are we getting all the real value out of our sales people? She did some analysis, discovering that most salespeople hit 80% of bonus target by simply fulfilling customer-initiated orders. As it turns out, most of the sales team got credit for sales that were going to happen anyway, even when the sales person simply answered the phone. These were basically recurring sales. There was no new sales activity. Current customers were simply ordering more of what they had previously bought.
As a result, this sales leader realized that these salespeople were not really growing personally or working hard to sell to new customers or further penetrate existing customers. Instead, they were just processing transactions. For this reason, she took a fresh look at her sales organization to determine how to shift their focus to new sales. She set up an inside sales team: a group that customers could call to order products and get questions answered. This approach removed most of the recurring sales work from the sales people. In return, it shifted their attention to new opportunities that required actual prospecting, relationship building, sales demonstrations, and selling.
Within a year, the organization reported remarkable improvements. The inside sales team retained the repeat sales the company had already been getting. The organization also saw a dramatic uptick in new sales because their salespeople were now spending their time selling instead of fulfilling inbound orders.
Steps to Improve Efficiency and Employee Experience
Success stories such as this point to several steps organizations can take to improve the efficiency and results of their sales teams and making life easier for their customers.
- Assess how salespeople spend their time. Make sure that sales teams are focused on activities that lead to selling – not simply filling orders from existing customers or other administrative activities (like contracting, lead generation, etc.).
- Review the “specialist” roles. Organizations offering a range of complex products and services often create specialist roles to support selling activities. Last year, I worked with a commercial organization that had up to eight different roles involved in the sales process, as well as key account managers. There were product specialists working with service specialists and more. Of course, there were good reasons for these knowledgeable experts to be available to answer customers’ questions. However, this company had too many roles involved. Reviewing the roles identified opportunities to simplify the customer buying process and touch points. Think through the interactions among each role and how to align incentives to enable the process.
- Clarify accountability. Make sure your organization is clear about who’s accountable for a sale, and customer interfaces, and who gets credit. For example, if five or six different salespeople and specialists are involved, who actually makes the sale? In addition, does one person get credit for the incentives that follow, or does the team share in the rewards? Avoiding the internal food fight and making sure the customer is experiencing a tight, focused response from your organization is key to successful commercial endeavors.
- Design incentives to reward sales. In our book, Mastering the Cube, we discuss linking reward structures with strategic behaviors and performance. Sales incentives should be tied directly to selling — not to simply being a member of a sales department.
Simplify and Focus
In summary, the common thread through all these suggestions is simplification and customer focus. Like any other division or department within an organization, the commercial function’s activities need to align with the organization’s strategic imperatives in the most efficient manner possible to achieve optimal results.