Optimizing Sales Resources – 12 Helpful Tips
Last month we discussed the natural propensities of the different types of salespeople and how some salespeople benefit from additional training or support – for example, Appointment Setting services that maximize the effectiveness of a sales team full of “Closers.” If you recall, we highlighted the three traditional types of salespeople:
Hunters – Those who are naturally gifted at generating leads (a.k.a. “Rock Turners”) but often need help closing deals.
Closers – Those who are naturally gifted at closing deals but often need help generating leads.
Farmers – Those who prefer managing accounts rather than turning rocks or closing deals.
One of our readers asked, “How do I tell which salespeople are the Hunters, Closers, and Farmers?”
Although these different types of salespeople are quite common, it’s often difficult to tell which salesperson has which propensities until you’ve managed them for a while. Many sales managers have found out the hard way that it’s very difficult to tell before hiring them. So what do you do?
Removing Variability
A sales leader’s dashboard can seem like the Space Shuttle’s cockpit at times; it can be overwhelming with so many levers, buttons, and dials. Where do you start? Without decades of sales management experience, it can seem nearly impossible to “optimize sales resources,” since each lever can impact sales results, sometimes dramatically.
For example, imagine trying to optimize just a few of these sales elements and get them all right – the timing and budgets of personnel decisions, GTM strategy, sales campaigns, lead generation, product launches, margin policies, discount structures, forecasts, pipelines, territory management, sales compensation plans, sales training, and so on. Each item impacts the end result. But by how much?
Six Sigma has taught us that in order to optimize an operation, we must remove variability.
First, document all variables used in the operation, then run the process to create a baseline. Next, adjust ONE variable, re-run the process and measure the result again to see if it improved, got worse, or had no impact. Repeat this process for each dial, control, knob, or lever you have and for each combination of controls, and you’ll soon learn that you’ll never reach the optimal result before the month, quarter, quarter, or year runs out! There are simply too many combinations of variables and too little time.
With so many sales variables to manage, how do you know which dial to move, when, and by how much?
12 Tips for Optimizing Sales Resources
When optimizing sales resources, there is no silver bullet, but here are a dozen helpful tips that can be used to help optimize your sales resources and, more importantly, build a framework of continual optimization:
Context. Remember - optimizing sales resources is a journey, not a destination. Since so many variables and options impact sales performance, the company must view Sales Optimization as a constantly evolving reiterative process. As a Sales Leader, you must continue trying new things to improve the Sales organization – and its results. Stable growth is good, but the status quo is not.
Bang for the buck. Focus on the dials, knobs, and controls (a.k.a. variables) you expect will “move the needle” the most. Group potential sales initiatives into tiers and prioritize. Once you’ve developed a plan to optimize the first level of sales levers, work on the next level down, and so on.
Look for Leverage. When selecting sales initiatives that “move the needle,” look for leverage. Focus on programs the business can launch with relatively limited resources while getting a 5:1, 10:1, or more ROI. Example: Consider launching a Channel Partner program rather than expanding your Direct Sales team. This approach allows you to access 10-20 independent channel partners for each Channel Manager hired rather than hiring one additional BDM who closes individual deals. It’s an entirely different GTM model, requiring different skill sets, systems, and resources, but given the right set of circumstances, it can be incredibly cost-effective and efficient.
ROI. When evaluating a new sales initiative, ensure you understand the overall ROI and the cost of the inputs of each variable. Include estimated costs to the business of doing it correctly; then estimate costs of doing it incorrectly and having to redo it (time value of money, the impact of the delay, cost of a bad hire, etc.) and, finally, the opportunity cost and risk(s) of not doing it at all.
Best Approach. Depending on the overall scope, timing, and budget, consider establishing either a Pilot Program or implementing the project in Phases to track early results and lower your upfront investment. Often, a low-cost pilot can be used to validate proof of concept while learning the pros & cons of the initiative. Examples: B2B Appointment Setting or Auto-renewal program.
Degree of Precision. Don’t get bogged down in the minutia. How much precision is required? Remember the axiom – “perfection is the enemy of good enough.” For initial planning purposes, ask yourself: “Do we need a scalpel or a chainsaw?”
Internal resources. To keep costs in check, look for available in-house resources that can be redeployed to support the initiative. Can you redirect unused funds from another project that is being shuttered or temporarily borrow underutilized resources from another department?
External resources. Look for quickly available external, off-the-shelf tools, so you don’t have to build them yourself. A ton of great software is continually being developed to help small businesses become more efficient. Most can be rented for a small subscription fee. Try a few to see which you prefer. Often, there’s already “an app for that!”
Build a plan. Document what you are trying to accomplish. Get specific – set goals, assign dates, and determine the required resources. Document your assumptions. Be sure to gain internal stakeholder support for the new initiative upfront. Make sure they are engaged early and are part of the solution.
Remain flexible, rinse, and repeat. Remember to be flexible and adjust based on what the data are telling you. Did it work as planned? Should we expand, adjust, or drop? Once you’ve established a baseline, set up a series of A-B tests to test new theories and tweak variables to test and improve results.
Establish a review process. Set ground rules for reviewing the program’s expected results (whether a Pilot or Phased) and boundaries to determine actions. Be willing to learn and admit that things may not have gone flawlessly, but remain committed to the process. If it doesn’t work, admit it and move on. Don’t take it personally.
Bring in a professional. If you don’t have the resources to do this on your own, or if you’re struggling to find the level of sales velocity and growth you need to achieve your company’s goals, it may be time to consider bringing in a Fractional Sales Leader. Sometimes a second set of eyes on a situation you’ve been struggling with for months is all it takes.
Mistakes Can Be Costly
To connect this month’s theme of Optimizing Sales Resources to last month’s theme of Appointment Setting, let’s focus for a moment on optimizing the personnel selection lever on your sales dashboard.
The U.S. Department of Labor claims a bad hire can cost your business 30% of your employee’s first-year earnings.
So, if your average sales rep costs $100,000 ($50k base salary + $50k commission), that’s a $30k setback in the first year alone. If you have a team of 8-10 sales reps and 30% turnover, the costs can add up quickly. Better to get it right the first time.
The natural question is, “how do I ensure I find the right salespeople for my business the first time?”
Besides relying on your gut instinct, there are a few online personnel screening tools available that can help you quickly and efficiently find sales candidates that match your position profile selection criteria.
One such tool is PXT Select, and it’s featured as our Productivity Partner of the month.
Sales Optimization is a Journey
In summary, there is no easy path to victory when it comes to optimizing sales resources. It may seem easier to make decisions by “gut instinct” or the seat of your pants. However, based on 30 years of sales experience, I’ve found that leveraging these tips will save you time and money by efficiently advancing your sales organization toward its “optimal” state.
If your sales organization could use a tune-up, let’s schedule a meeting to talk about it.