How “Intervention” Can Improve Sales Management for Smaller Firms
When it comes to sales management, there is a forgotten market segment crying out for professional help.
This forgotten market segment are companies and organizations with sales/revenues in the $1 million to $25 million range. This includes manufacturing companies, distribution organizations and service firms. All of these companies depend on sales or some form of business development for their new relationships. The problem is that these companies can not afford a dedicated sales manager.
Typical of companies in this category is the manufacturer, fabricator or professional services firm. Such a company may very well have inside sales people, one or more outside people calling on customers or prospects as well as doing missionary work. Added to this mix might very well be a network of independent manufacturer’s reps.
Because the company is relatively small by today’s standards, there usually is no budget for a dedicated sales manager to direct and supervise all these internal and external sales people and organizations. In the absence of such a dedicated manager, the owner or CEO is saddled with the responsibility of sales management. However, that owner is saddled with many other responsibilities – like running the business, managing operations, hiring, working with attorneys and accountants. In most cases, any or all of these tasks take precedent over sales management.
Moreover, many entrepreneurial business owners have their roots in the scientific or technology areas and have very little experience in sales and marketing. Given all their other responsibilities, sales management is low on the priority list. Also, because this is foreign to the owner/CEO he probably wishes to regard sales management as a problem that will hopefully go away by itself.
As a marketing/sales consultant who specializes in small-to-mid-market companies, I often am brought in when the level of “pain” or frustration reaching the boiling point. At this point the owner/CEO when faced with underachieving performance realizes that simply firing those involved will not solve the problem. That owner/CEO is not ready to incur the overhead of a company-employed sales manager and yet has neither the time, ability or inclination to do it him/herself.
Case #1 – Service Organization
One situation where I was brought in was a service organization owned by two partners. The firm was experiencing extremely poor sales. One partner was the “systems guy.” He, in effect, ran the business. The other partner was charged with business development. Unfortunately, the latter was totaling lacking in basic sales skills because he never received sales training and has no concept of sales management. While aggressive in his approach to prospects, he lacked telephone sills, time management skills, the proper sales literature and information and didn’t know how to approach decision-makers. As in addiction situations, the two partners agreed that “intervention” was needed. A sales consultant, me, was retained who functioned essentially as an external sales manager.
I coached the sales partner, worked with him to implement a sales contact control system, taught him basic telephone skills, helped him develop contemporary leave-behind literature. In six months the situation turned dramatically. The under-producing sales partner started bringing in meaningful business. By gaining confidence in his own abilities, this sales partner was able to transform his already-powerful energy into accomplishment. In one year, the business base of the company doubled.
Case #2 – Value Added Manufacturer of Commodity Products
Another situation where I became involved was a manufacturing company that took metal in a raw form and fabricated it into a variety of products that were sold in the business-to-business environment. The owner was largely absentee and he left the management of the company to his highly capable vice president. The sales function was handled by two skilled inside sales people, a pleasant but underachieving outside sales rep. and manufacturer’s rep. network that contributed virtually nothing to the sales and profits of the company.
To make matters worse, the company was involved in a highly price-sensitive industry where there was an excess in capacity and rather cut-throat competition. The products being sold were commodity-type offerings where customers perceived little difference in quality and brought primarily on price.
This vice president charged with running the company simply had too much on his plate to effectively manage the sales. While his inside sales group performed brilliantly, they essentially were order takers. The outside sales representative was supposed to be the business maker but he wasn’t performing. The manufacturer’s rep organization was totally alienated from the company.
The vice president/manager also decided that “intervention” was needed. He hired a consultant, me, who immediately began chairing a sales meeting once a month and started working closely with the under-achieving outside rep. The key was to initiate time-management disciplines. Quotas for outside meetings were established. Given this rep.’s pleasing personality and knowledge of the business, it was only a matter of time before he started bringing in business.
I also created a monthly electronic newsletter that improved communication with the manufacturer’s rep. organization. These reps were able to articulate their problems with the company and new procedures and incentives were put into place. New sales started flowing in from the rep. organization.
My most significant accomplishment was my observation that what was believed to be a pure commodity marketing in reality was not such a marketplace. The company was able to differentiate itself from competitors through value-added services, better and quicker deliveries and product features and benefits that were superior to competitors. Thus, the company was able to justify higher prices because of the value-added products and services it was providing.
In neither case was it necessary to hire a full-time dedicated sales manager. In both cases, the company was able to hire a consultant for a reasonably monthly fee. And, in both cases, the results were dramatic!