CEO Forum

Turbo-charge your sales

Turbo-charge your sales

One powerful method of boosting both revenue and margins is to raise the productivity of your salesforce.

  • 읽기 소요시간

Article

Turbo-charge your sales
en

When business conditions turn harsh, companies need every dollar of revenue they can find. But is there any way to rev up sales without giving away the store?

One powerful method of boosting both revenue and margins is to raise the productivity of your salesforce. In good times, increasing salesforce effectiveness helps companies grow faster; in a downturn, a scientific approach that puts systems around the art of selling can be critical to keep revenue flowing without cutting margins.

The first step is to develop a data-driven "heat map" of accounts and prospects. Every company has its best customers, those that are the most profitable and typically the most loyal. Sales executives usually identify them by analyzing win rates, revenue, relative market share, and profitability among customer segments.

But a downturn like this one demands an even sharper focus. Mangers and sales reps need to know exactly which customers will continue buying. Which have strong cash positions, good access to credit, or both? Which companies or individuals should be your best customers? In a down market, many companies are re-evaluating their suppliers. That creates opportunities to steal share from a distracted competitor.

All these high-potential customers are the hot spots in an otherwise cooling economy. Once you have a sense of who they are, you can draw a heat map of the market to guide your sales efforts. Managers can screen out the opportunities that don't fit the map and focus reps' efforts on those that do. With the longer sales cycles of a downturn, companies' selling resources are stretched across more accounts, and managers have to make certain they are aimed at the right targets.

A few months ago, for example, a broadcasting company refocused its advertising sales team on a few hot segments. One was health-care providers, which appeared to be less affected by the downturn. Another was specialty retailers, which desperately needed advertising to counter declines in consumer spending. After just two months, sales in the broadcaster's two test regions were up 90 percent and 450 percent.

The heat map also helps to reassess territories and quotas. Do territories correspond appropriately to the map? Are quotas realistic in light of the new conditions? One midsized network equipment company we studied had been pursuing fifteen different industry segments. But its heat map showed that just five of those segments accounted for most of its revenue and profits. So it redesigned territories and reset quotas accordingly.

With longer sales cycles, managers need to ensure that reps have realistic assessments of when they expect sales to close. The key here is careful forecasting, tracking, and discussion of major opportunities. Even if elapsed time increases, the company should have internal benchmarks on conversion rates from one stage to the next and historical win rates relative to major competitors—and should apply those benchmarks rigorously. Some companies create a "Deal War Room"—with the heat map on the wall—to ensure that this kind of discipline is applied consistently.

Sales managers face two other challenges in a down market. One is to maximize the time reps spend in front of the high-potential customers highlighted by the map. You may want to measure the time reps are with customers compared to total time. If it's less than what you think it should be, or less than benchmarks for your industry, consider channeling some of the reps' administrative functions to support staff or simplifying the systems that the reps are expected to deal with. A few years ago, Cisco Systems streamlined its sales reps' administrative chores and freed up a few hours additional selling time in each rep's week.

The other challenge is controlling costs, which may entail streamlining and rationalizing the salesforce. Most companies use a variety of sales channels: enterprise or other direct sales, telephone sales, dealers or value-added resellers, and the Internet. Detailed information about the behavior and profitability of customer segments and microsegments from the heat map, as well as data about the productivity of existing selling efforts, allow sales executives to decide how best to deploy these different resources. To keep costs low, for instance, a company may decide to beef up its telesales operation and replace underperforming in-field reps.

No downturn lasts forever. When the recession thaws, your sales organization should be positioned to capitalize on pent-up demand. Companies that win during turbulence often recruit top sales talent from competitors, or may even pursue acquisitions and integrate the acquired company's best sales reps with their own. A heat map helps show the way to that future.

Dianne Ledingham is a leader of Bain & Company's salesforce effectiveness group, within the firm's customer strategy and marketing practice area.

태그

베인에 궁금하신 점이 있으신가요?

베인은 주저 없이 변화를 마주할 줄 아는 용감한 리더들과 함께합니다. 그리고, 이들의 담대한 용기는 고객사의 성공으로 이어집니다.