The internet has turned everything on its head. Knowledge is readily available and companies are competing as much against their customers’ ability to find information as they are against their competitors. In an information rich world, customers are well informed about their needs and what they can expect and/or are willing to pay. 1 In a time when ordering is done online and suppliers switched with a click of a mouse, sales reps need to bring market insights, not a free lunch! Reps today need to turn readily available information into revealing market insights that could benefit the customer while matching them to a solution provided by their company. This shift has made management systems that tracked sales reps’ compliance to a prescribed process all but redundant. Take the example of one progressive company.
Company “ABC” moved from a command and control model to a franchise model giving account teams responsibility for their region’s P&L. Regional teams were tasked with developing regional strategies (without deviating from the mission or values of the company). Sales teams were trained and held accountable for growing the business and turning a profit by exercising sound business judgment. In the end, the sales force was reduced by 10% and sales went up 5%. The result was approximately 1.2 billion dollars transferred to the corporate bottom line.
Moving a sales team from a process driven to a market insight driven system where sales reps link clients to a solution they can provide is no easy feat. Equally difficult is for senior management to relinquish control and trust field sales managers and teams to develop their own territorial strategies. The challenge in applying a model like this is that everybody is looking for a silver bullet. So where do you start?
Realistically, start by understanding that some people don’t want to think for themselves, preferring to think of a business strategy as a formula to be followed that will lead to a pre-defined goal. “Business strategy” is attractive to these people for all the wrong reasons. They believe that if you imitate what someone else has done you’ll get the same results. A business strategy developed by these people is un-imaginative, as is their thinking.
Innovative companies know they need to stay away from these dangerous delusions. 2 Since business opportunities rarely arrive in a pre-defined, systematic order, a business strategy never proceeds in neat pre-defined steps. Rigid strategies can result in demanding reps to sell birth control to a retirement community or designing one service truck for all customers worldwide. The answers are clearly not in the book! Good business strategies are situation specific and rather than being rigid, a brilliant strategy is quite the opposite giving your company the ability to execute differently depending on the circumstances. Because circumstances often vary by country, region and customer, the more flexibility your strategy has the more likely it is to succeed.
A favorable market situation will never be exploited if managers must wait for senior executives to make up their minds so it’s equally important to develop trained leaders and teams that have the power to act on local information and make informed decisions. Failure to act in a timely manner is the worst strategy of all! Centralized, command and control type sales organizations can lock you into linear strategies and perpetuate delays. It’s for this reason that teams, within reason, need control over discretionary resources. A fluid, segmented sales team gives you options to exploit targeted markets by identifying customer needs that senior management can’t spot from their office tower.
The two most important strategic choices you’ll make in your career are how you structure your organization and how you train your teams to succeed. In your lifetime new products will come and go, patents will expire, processes will be copied, but teams that can develop local strategies tailored to their customers’ needs are a sustainable competitive advantage! Develop your strategy!!
1. Dismantling the Sales Machine, B Adamson, M Dixon, N Toman HBR Nov 2013
2. 33 Strategies of War Robert Greene