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Building a High-Performance Sales Team
Kate Dunn — Director, InfoTrends
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Agenda Assess Your Current State Build Your Plan
Coverage & Compensation Hiring Define Objectives, Goals and Expectations Managing Your Team Summary and Next Steps Before we do a deep-dive into technology tomorrow, we need to lay some introductory groundwork. We will do a quick recap of key printing technologies you will see out in the field and the key advantages digital technologies. We‘ll see how well you have paid attention when you try to match some print samples to the output type. Then we will take a virtual tour through the print shop focusing on the people, process, and products involved in each area.
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STRATEGIC MARKETING PLAN
Where Sales Fits BUSINESS PLAN OPERATIONAL PLANNING STRATEGIC MARKETING PLAN WORKFORCE PLANNING SALES MANAGEMENT PLAN Key Messages A business plan is a set of carefully thought out Business Goals And Strategies to reach those goals Based on careful analysis of existing business and market data A good plan requires that you are realistic about what you can sell profitably today and in the future. TERRITORY PLANS ACCOUNT PLANS
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A Sales Management Plan
Your sales management plan helps you develop a high performance team that can deliver consistent performance. Understanding what you need, how your current team stacks up in comparison to today’s new selling approaches will help you hire the right people, on-board them successfully and give them the support they need to be successful as quickly as possible. A thorough sales management plan includes the following. Defining the buying and selling processes Identifying and qualifying prospects Assessing talent Forming coverage strategies Generating a sales funnel Value proposition/sales messaging Developing sales compensation packages and individual sales plans Understanding the technological requirements to support the plan Today we are focused on Finding the right people and building a process that helps them be successful, allows the company to achieve it’s goals and can be replicated as you grow and add additional sales reps. Sales management can be defined as planning, implementing, and controlling the personnel and processes used to achieve the sales and profit objectives of the firm.
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Assessing Your State
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Vice Admiral James Bond Stockdale (December 23, 1923 - July 5, 2005)
The Stockdale Paradox “This is a very important lesson. You must never confuse faith that you will prevail in the end—which you can never afford to lose—with the discipline to confront the most brutal facts of your current reality, whatever they might be.” I didn’t say anything for many minutes, and we continued the slow walk toward the faculty club, Stockdale limping and arc-swinging his stiff leg that had never fully recovered from repeated torture. Finally, after about a hundred meters of silence, I asked, “Who didn’t make it out?” “Oh, that’s easy,” he said. “The optimists.” “The optimists? I don’t understand,” I said, now completely confused, given what he’d said a hundred meters earlier. “The optimists. Oh, they were the ones who said, ‘We’re going to be out by Christmas.’ And Christmas would come, and Christmas would go. Then they’d say,‘We’re going to be out by Easter.’ And Easter would come, and Easter would go. And then Thanksgiving, and then it would be Christmas again. And they died of a broken heart.” Another long pause, and more walking. Then he turned to me and said, “This is a very important lesson. You must never confuse faith that you will prevail in the end—which you can never afford to lose—with the discipline to confront the most brutal facts of your current reality, whatever they might be.” To this day, I carry a mental image of Stockdale admonishing the optimists: “We’re not getting out by Christmas; deal with it!” Vice Admiral James Bond Stockdale (December 23, July 5, 2005)
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A B C What’s Your Situation?
Your sales team is a revenue machine They have the right skills and experience They are highly motivated and focus on activities that drive sales B You have a mix of strong and weak players on your team Some require a lot of hand-holding and you don’t always have the time to give them the help they need In the A group you have companies in this situation have sales teams that understand who they should sell to, what they should sell and why companies should buy. They are focused, organized and are basically revenue generating machines. When the market changes they can adapt, find new ways to bring value, and easily transition to selling new things. If you are in this category you might thing you can get of the webinar now but I find that occasionally, these organizations are inherited and previous managers had a good system but as people retired or the organization scales problems start to arise. Companies in the B group are do things a bit more by the seat of their pants. Things aren’t as clearly defined so they aren’t as productive as they could be. They may have some good reps that are doing a lot of things right and like those in the A group can adapt to changing market conditions but since the direction isn’t as clear, it’s typically because the reps themselves are figuring it out. Teams like typically have a wide disparity between the close ratios of your best reps and the rest of the team. Their breadth of participation is lower than it should be and your results are inconsistent. Companies in the C group are sort of running amuck. They don’t have a good plan, they typically don’t have the right people, if they do find could people, they end up frustrated with the dysfunction and move on. Part of the reason is that they are typically unmanaged. Maybe your are a selling owner and with those responsibilities plus running the company there just isn’t a lot of time left to give your other sales people the help they need. C Your sales are unpredictable Your team spends most of their time “quoting and hoping” They have little direction and are consistent underperformers
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Step 1: Build Your Plan
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Building Your Plan BUILDING YOUR PLAN Coach & Manage Set Goals
Build Hiring Plan Align BUILDING YOUR PLAN Compensation Plan Define Coverage Strategy Inexperienced or uniformed sales leaders think have this flipped so their focus is managing. They ask reps what they are doing and spend all their time trying to order bully strong arm browbeat the reps into submission. Others try to kill their reps with kindness and either don’t even try or do a terrible job of holding their organization accountable. The reality is that you have to build a strong foundations that is based on knowing what you are trying to do, why you are doing it and having a real plan to do it. Develop a Training Plan Perform Talent Assessment Define the Required Skills Define Company Objectives
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From Your Strategic Marketing Plan
You should know this! What to sell Who to sell it to Why customers need what you sell Why customers will buy from your organization How much you want to sell We’re going to assume that you already know from your strategic marketing or business plan the answers to these questions. If you aren’t clear about these things or if it’s your job to figure this out, you need another webinar! You can still learn what you need to do after you can define these things today.
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58% 67% Selling Processes Need To Change
There Is a Disconnect Between Buyers & Sellers 67% of sales reps aren’t making quota 58% is the average quota attainment
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Not Giving Buyers What They Need
Are increasingly difficult to reach Frequently complain that reps are woefully underprepared See no reason to meet with sales reps Are increasingly difficult to reach This dramatically reduces sales productivity metrics Frequently complain that reps are woefully underprepared and seemingly not attuned to the fact they have access to endless amounts of information and perspective prior to meeting with them Have stopped inviting sales reps back to take the process forward This dramatically reduces ROI on lead generation practices
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Buyers Are: Sellers Are: Power Shifts Toward Buyer
Increasingly more educated than the seller Already deeply aware of their problem with a well-scoped RFP in many cases Sellers Are: Having difficulty adding value or convincing the decision-makers to rethink their conclusions Being forced into price- driven conversations Increasingly, buyers are more educated than their reps, they have a deeper understanding of their problems and are already predisposed to a specific supplier. This leads to more price driven conversations. You may win but at lower margin. And more and more frequently, the rep is losing the change to drive a profitable sale even before they’ve met with their prospect. >>> Original Slide Text <<<< By the time the rep gets to the table Buyers are more educated than the seller Buyers already have a deep understanding of their problem In many cases with a well-scoped RFP Sellers find it difficult to add value of any kind or convince the prospect organization to rethink their conclusions Sellers are forced into price-driven conversations
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Differing Definitions of Value
Are increasingly difficult to reach This dramatically reduces sales productivity metrics Frequently complain that reps are woefully underprepared and seemingly not attuned to the fact they have access to endless amounts of information and perspective prior to meeting with them Have stopped inviting sales reps back to take the process forward This dramatically reduces ROI on lead generation practices
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14% Leads to Price Comparisons
Only 14% of customers perceive a real difference between supplier offerings AND value the difference enough to pay for it. 14% Read some of value propositions provided earlier and compare to this list of what decision makers value: Rep offers unique and valuable perspectives on the market Rep helps me navigate alternatives Rep helps me avoid potential land mines Rep educates me on new issues and outcomes Supplier is easy to buy from Supplier has widespread support across the organization Source: Corporate Executive Board
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4X You Need A New Kind of Rep
Customers put the highest value on salespeople who make them think, bring new ideas, and find creative and innovative ways to help their business 4X as many decision-makers prefer to have discussions about business trends, business issues, and business insights than traditional product knowledge-driven sales conversations. Forrester Research did a study along the same lines of decision makers to see what percentage of the time sales reps have these types of valuable conversations. Answer: 7% according to Forrester Research. ( Source: SiriusDecisions
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What Customers Want Rep offers unique and valuable perspectives on the market Rep helps them navigate alternatives Rep helps them avoid potential landmines Rep educates them on new issues and outcomes Supplier is easy to buy from Supplier has widespread support across the organization All this research done by the CEB that became the basis of the Challenger Sale found that buyers will be loyal to reps who can do the following.
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Insight Selling Skill Requirements
Description Communication Excellent written and verbal communication skills Presentation Can present to a team of decision-makers using appropriate technologies Understanding A thorough understanding of common marketing objectives by channel and key communication trends impacting the customer’s communication objectives A thorough understanding of all solutions offered by the company and the benefits that those solutions can bring to the customer Understands the sales process dictated by the company and can demonstrate an ability to move a new opportunity from initiation to close and apply learning to additional new opportunities Phone Skills Can deliver a well-structured message by phone to a new contact/prospect Research Can research potential new opportunities and decision-makers using the Internet, LinkedIn, and other applicable means Record-Keeping Can keep accurate and up-to-date records of contacts and opportunities with prospects using a company-supplied technology (e.g., CRM system) or other manual means dictated by the company
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Ricoh has People who can Help
We understand a good hire is driven by the personality and production reality of the print shop. Ricoh Business Booster makes it easy and accessible for you to work with a trusted resource to match the right type of candidate with the current and future needs of your organization. Ricoh has customized services that can guide you through the process of creating a high-performing sales team. Discover Analyze Plan Deliver Manage
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60% 3X Get Smart & Stay Smart!
of customer loyalty is a result of not what you sell but how you sell it. 3X Buyers are three times more loyal to sellers who proactively bring opportunities to their attention. Source: The Rain Group, Your Guide to Insight Selling Success, Mike Shultz & John Doerr
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Training Isn’t Enough! Between 85% and 90% of sales training has no lasting impact after 120 days. DAY 1 DAY 120 Source: ES Research Group study
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20% sustained improvement
Coaching is Essential! A Sales Executive Board Study found that sales representatives who received quality coaching achieved a 20% sustained improvement in performance. Which of your sales reps will realize the greatest impact from coaching? 20% sustained improvement Source; The Dirty Secret of Effective Sales Coaching, Matthew Dixon and Brent Adamson
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LOW SKILL PROFICIENCY HIGH
Assessing Your Current Sales Team LOW PERFORMANCE HIGH JANE MARY FRED BOB LOW SKILL PROFICIENCY HIGH ED Key Messages: Let’s look at your current teams performance. On one axis you have their performance and on the other their motivation to get better. In this case Mary has great performance because she has some big accounts and is selling a lot of offset printing. She doesn’t want to learn new things though and isn’t interested in selling new services like cross-media or web to print. Then there is Ed. He isn’t selling much and he isn’t highly motivated to change. You keep him around because he’s on 100% commission and you feel like he isn’t costing you much. Then you have Jane and she is really working hard, trying to learn all of the new things but her performance just isn’t there yet. Lastly there is Fred. Fred may even have moments of high performance that but generally he isn’t making his goals and he tries things every now and then but isn’t consistent. Discussion Question: What would you do with this sales force? Where would you spend your time?
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LOW SKILLS PROFICIENCY HIGH
Where Do You Spend Your Time? Business Development Role Mentoring Empowerment Smaller Account Opportunities Training LOW SKILLS PROFICIENCY HIGH Direction Change of Role Happier Elsewhere Non-evolving Role Minimize Impact Managers engage with poor reps because they feel they must in order to meet territory goals, and they work with their best reps because, well, it’s fun. Unfortunately, data show that both managers’ coaching tendencies, and companies’ response, are misguided. In research involving thousands of reps, we found that coaching — even world-class coaching — has a marginal impact on either the weakest or the strongest performers in the sales organization. The real payoff from good coaching lies among the middle 60% — your core performers. For this group, the best-quality coaching can improve performance up to 19%.* At the end of the day, who your managers coach is just as important as how they coach. LOW PERFORMANCE HIGH
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Teach Managers to Coach
SALES MANAGEMENT REQUIRES A DIFFERENT SKILL SET Set clear expectations for the amount of time that managers should spend coaching In high-performing organizations, managers spend 25% - 40% of their time coaching Set new expectations for sales managers Productivity of new reps Breadth of participation Team developmental objectives
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Coverage & Compensation Planning
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During Your Transition
Change coverage strategies to reduce the impact of those not motivated to sell the new way Reduce the size of territories for those tasked with account development Understand the true value and opportunity of each territory Goal: Drive breadth of participation among the sales force and a deeper penetration of the marketplace
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Align Compensation Focus New Product or Service Transitioning to MSP
Selling Print Rep Characteristics High energy, emotional, and enthusiastic Aggressive and impatient Handles rejection well Driven by money Challenges the status quo Even-tempered, analytical, logical, competitive, controlled ego Can navigate complex and lengthy sales cycles Negotiates well and has a high degree of business acumen Career-oriented Disciplined, organized, and reliable Service- and relationship- oriented Detailed oriented Dependable Compensation Type Lower base or draw plus high % commission Transaction based Immediate commission Higher % of base salary plus commission for growth and new business Salary Recognition Highly visible Promotions/bonuses for exceptional effort Access to additional learning Retention bonus Non-pay-related perks Key Messages There are different types of sales reps. Some have a great skill set for selling a product or service that is new to the market. Others are good for fast growth companies where early adopters of the service require business justifications that necessitate more complex buying processes. This is where cross- media and web to print are in their evolution. You could perhaps even consider VDP in the category for certain applications. Once a product or service is established in the market, still other characteristics are necessary. VDP for employee communication and other key applications that have been in play for many years could be in this category. Lastly once a product or service has reached the mature saturation the role of the sales rep transitions to one of responsive customer service. This is actually where most of the offset and digital print applications lie today. Each one of these scenarios requires a different type of compensation plan. Sometimes these exist within a single company. A printing company that is also adding marketing services actually needs multiple compensation plans.
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The Best Plans… Are aligned with corporate objectives
Sales of New Services Focus on Profitability New Business Are documented and clearly defined Are evaluated regularly Create accountability Key Messages A good plan means that each component of the sales compensation plan maps directly to a corporate objective and significantly increases the probability that it will be achieved. To illustrate, consider a sales compensation plan that supports an aggressive growth strategy. One option in these circumstances is to use a flat commission rate; salespeople earn more if they sell more. A second option is a plan which pays higher commission rates for new customers than for repeat business, and which offers attractive bonuses for exceeding quota. While one could argue that both plans are aligned with a growth strategy, the second demonstrates this alignment to a much higher degree. It must be documented for the sales force and it should clearly define the components. In order to set and maintain expectations, rely on comprehensive documentation that is written in layman’s terms and easily accessed. It should describe payment calculations, all related administrative policies and practices, and most importantly, the process for resolving payment errors. Active management of sales compensation provides a statistical, factual basis for evaluating the effectiveness of the program and for considering possible changes. Knowing whether, when, and how to implement a change will minimise contention and keep salespeople focused on overachieving.
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Create a Culture of Accountability
Starts at the top of the organization Requires focus and consistency Is more difficult if reps see your new focus as the “flavor of the week” Key Messages Accountability is key for both managers and sales reps. If your company tends to have problems holding each other accountable, your plan is likely to fail. There are processes that you can initiate that can help to hold yourself accountable. For instance, weekly staff meetings where key data is presented can be a great way to hold sales leaders accountable if their senior management is not doing so. Also consider other resources like peer groups that can provide a forum for accountability.
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Build Accountability Into Your Plan
Set clear behavior and performance expectations Define the “check up” process and timeframes Define steps in advance that will be taken if milestones are missed Apply the process consistently! Key Messages It’s important to remove the subjectivity from your plan. It’s ok to have multiple plans but employees in the same position should have consistent compensation plans. The salary portion of compensation plans often vary by the experience of the rep, past success and time with the company. Great compensation plans will set clear expectations for both performance targets and expected behaviors. Great plans also define the timeframes for evaluation and outline the “check up” procedures meaning what action can occur if the rep is not meeting sales goals. Plans for new hires often focus on activities rather than sales in order to reinforce behaviors that lead to sustainable sales success. These are typically transitioned as soon as the ramp up period is complete. Many companies offer modifications during the ramp-up period. They may pay a rep a larger salary while they are learning and then transition the percentage of compensation to a higher number. JAN FEB MAR APR MAY JUN JUL
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Hiring New Reps
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Hiring: Rules of Thumb It will always take longer than you think!
Be realistic about the ramp-up time Develop a position description first Use multiple sources Networking, Online, Recruiters, Employees If you have the resources, have bench strength Define your interview process
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Interviewing Process Tips
Pre-set interview questions Multiple interviews/interviewers Schedule meeting at different times of the day Build in ways to evaluate writing, phone and presentation skills Use outside resources to validate your thinking Do not hire recent college grads without a structured on-boarding process
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Defining Sales Goals & Activity Standards
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Be Clear About Objectives
Revenue Profit/Margin New Business Retention Key Product / Service Sales Market Penetration Key Messages Your sales plan includes your goals for the year. Those goals should be at the company level and then broken down into smaller pieces which could include goals for offices, regions, at at the sales rep level. Goals should also be set for profit or margin targets to ensure your sales are profitable. Most companies need new business so goals for new account acquisition. It’s also a good idea to set goals for retention. It costs more to find new customers than to keep the ones you have so even though you are focused on selling, you need to care about retention as well. If you are trying to break into a new area, than setting specific goals for key products or services that represent your future are a good idea. Sales people will gravitate to what they know best. Adding specific goals for new services helps the sales team learn and sell new products. Lastly, you want to set target compensation goals which is the amount of money a rep should be making at plan and at various levels of achievement.
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You Need to Measure Activity
Activity data helps identify training needs. A CRM System really helps. Discussion Question Why is it important to measure activities and not just results? Probe for these answers: Identifies potential short falls while there is still time to fix them. Helps reps focus on the types of activities that generate sustained success. Helps managers identify problem areas and provide needed training to correct. Improves forecasting capabilities for managers What sales activities lead to achievement of sales goals? Prospecting – making warm calls, networking, referrals Appointments with key decision makers Proposals Negotiations Program sales Quotes
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Make Adjustments As Needed
Model best practices Evaluate problem areas and adjust activities/training If your goals are too easily reached, extend them! Follow your accountability plan Define measurement milestones in advance Key Messages Sales management should monitor their plans and make adjustments accordingly. Isolating best practices can help uncover the right mix of activities. If goals are too easily reached, the organisation will be resting on its laurels so to speak. Great managers can work with reps to develop extended goals that go beyond their original goals. Sales reps can become distracted when correction is necessary causing a death spiral of sorts. One way to avoid this is to agree on the likely correction steps in advance as part of the planning process. Another important element of the plan is to come to agreement with reps up front when the key measurements and corrections will take place. Often this is quarterly but could be monthly especially if the rep’s performance has been inconsistent in the past.
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Managing Your Sales Team
Transition: You’ve got a lot to do here as you monitor your strategy, keep track of performance, manage you sales funnel and train and develop your people. You need to put some structure to how you will get this all done.
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Your Role as the Sales Leader (1)
Skills Assessment Value proposition Demonstrations Insight delivery Proposal presentations Training and Development Support small group training sessions on sales skills and business acumen Insight development Vertical/Horizontal market knowledge New products/services offered Best practice sharing Key Messages Here is a partial list of things to assess about the skills level of your existing sales staff. You have to think about the kind of development the team and individuals on the team need and how you can train them your team on the things that can help them improve. Discussion Question: What do you need to add or take away from these lists?
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Your Role as the Sales Leader (2)
Coaching Reinforcement of training Continuous improvement of skills Motivation Planning Reporting Sales Pipeline Productivity Personal Development Key Messages: Reps will forget (and you will too) 80% of what they learn in training if it is not reinforced following the training. That means they will need coaching and motivation to continuously improve their skills sets. You will also need something to measure besides just sales that indicates the training is taking hold. Lastly don’t forget about your own personal development. What will you need to continuously improve? Discussion Question: What do you want to add to these lists?
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Review Sessions Are Critical
Weekly Funnel/Forecast Reviews What’s in and out? What help is required? 15 mins per rep Key Messages: The information you need has to come from both your reps and your systems. Discussion Question: What would you do in a funnel/forecast review? Probe for these answers: Management inspects the funnel for each rep to determine: Monthly forecast Risk and Up Side Opportunities 60 – 90 opportunities – do activities support goal attainment? Prospecting activities to add to the funnel Trends – are opportunities flowing through the funnel better or worse than expected, what is stalled and why? Integrity of the funnel – is it up to date? Is the information accurate? Time management Territory management – retention problems, customer complaints etc
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Monthly Planning & Review Sessions
One on One – 1 manager and rep Agenda Items 30 & 60 day forecast delivery vs. plan Includes upside opportunities Qualification criteria YTD Actual vs. Plan Top Strategic Suspects* Insight to be delivered Engagement strategy Existing Accounts* Resources needed 1 hour per rep Outputs Travel Days Schedule (2 per month) Updated Developmental Plan Updated Commitment Action Document *If rep assigned new business responsibilities
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Monthly Team Meeting Management Team and Sales Team Training Outputs
Product Sales Skill Best Practices/Customer Case Studies One per rep Lessons learned Revised/New Insight Presented by management 60 – 90 minutes Outputs Best Practices Shared Case Studies for Marketing (includes metrics) Process Improvement Requests Revised/New Insight
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Annual Planning Sessions
Reps present their strategy to achieve their sales goals Critical Opportunity Reviews: High risk accounts High potential accounts Discussion Questions: What areas would you cover in a Territory Development Session? Probe for these answers: New business strategies, networking opportunities, referrals, contact strategies What would you work with your reps on in Critical Opportunity Reviews? Probe for these answers: Coincides with Qualification Criteria Step of the sales cycle and is it moving? Alignment with prospect’s buying cycle All stakeholders identified and engaged? Is there significant value in changing? Have all business drivers been identified? Who are our competitors? What is the probability of closing? Why should we win this, and why might we lose this? What can we do to secure a win? What support do you need to close this opportunity? What questions would be answered in a Key Account Review? What are the key business drivers affecting this account? What is our share of the account and what opportunities for us do they present? What is our competition doing and how can we minimise the risk? What is the long term opportunity and what are we doing today to position ourselves for future success? What additional support do you need to develop this opportunity?
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Summary & Recommendations
Buying has changed forever, so your sales team must evolve for you to be successful. Focus your efforts on core performers; moving the needle even a little can have a tremendous impact on overall performance. Use your resources. Make training, coaching, and mentoring part of the development plans for “Role Model Reps”; seek outside resources to assist you and peer groups to hold you accountable. New hires from outside the industry need infrastructure in the form of training, coaching, management, and specific goals. Build a plan that lets you transition by minimizing the impact of “won’t dos” and providing support for current “can’t dos.”
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When Can it Be Completed?
Jump-Start Plan Steps What Must Be Done? Who Will Do It? When Can it Be Completed? Define Sales Skills Needed Add additional skills our business requires to list provided in webinar. Assess Existing Team Using Performance/Skill Graph Use performance/skill graph and newly defined skills list to assess current talent; research 3rd party assessment tools. Develop a Training and Coaching Plan How can you help existing team and potential new hires develop the skills they need to be successful? Analyze Compensation and Coverage Strategy if Required Do you have the right reps focused on the right things? (see slide 19) Does your comp plan incentivize the behaviors and activities that will determine your success? Determine Sales Headcount Required Including Sales Hires Assess whether company’s growth goals for 2016 are realistic given existing sales talent. Build a Hiring Plan Position description Sourcing channels Interview process Compensation Target dates
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Thank you!
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