Managing the sales process to build sustainable top-line growth
Some salespeople, even though they appear to have the right stuff, just don’t seem to perform. Perhaps that’s because when at first they don’t succeed, they find it’s easier to slip back into unsuccessful behaviors than to try, try again. Here are some ways to help ensure they adapt to your institution’s best practices.
Until the uncertainty surrounding our economy fades, many small to midsize businesses will continue paying down debt with excess cash, affecting revenue and both sides of a bank’s balance sheet. And while revenue opportunities in our markets still exist, the competition for each opportunity is high and will remain so until the economy turns around. Yet, despite the economy, most financial institutions remain committed today to meeting their revenue goals without sacrificing profitability or asset quality. Impossible? No. Difficult? Yes.
Sales Performance Varies within a Sales Team
Average-performing sales people–those who reach 80-120% of their sales goals–make up 80% of the workforce. These folks require more “external” support and motivation than do the 10% who are considered the high performers–those possessing the total package of cognitive, language, and social skills as well as the personal discipline, passion for selling, and sense of urgency to get things done. If average performers knew how to perform at a higher level, they would. As one bank sales manager said, “My average performances want to win. They’re good people.” Yes, but in most cases they don’t know how to win.
Most inexperienced sales management teams think they need only two motivators–goals and money. However, when we look at the highest-performing sales forces in banking, we see a broader range of support systems and extrinsic motivators that combine to form an overarching sales management process (see Table 1).
Increased Sales Performance, Not Just Increased Sales Activity
“In the past six months we’ve increased our calls by 50%. But we’re not seeing significant increases in our pipeline or closed business. I’m concerned about the quality of our calls.”
The bank president’s comment came at the end of a executive management sales meeting that reviewed the past quarter’s closed business reports, current pipeline numbers, and call activity summaries. Activity levels were higher than ever–his bankers were on the streets. But so were his competitors’. So, how do we win in tough competition? Apparently, making more and more calls isn’t the answer. (A certain level of calling is critical, however. In the best-performing sales teams, commercial bankers make 20-25 sales calls per month, branch managers make 15-20 calls, and small business bankers make 25-35 calls.)
Winning in a competitive environment goes beyond just being on the streets and picking the “low-hanging fruit.” Competing to win means focusing on the right targets, using the right value proposition, working with the true decision maker, thinking like a business owner, and developing clear and effective strategies based on these factors. So the bank president’s question about whether his people were making quality calls was on target.
Isn’t the Quality of Sales Calls a Sales Training Issue?
Most banks today have built the foundations of a sales management process: They have established goals, introduced monetary incentives, and hold regular sales meetings to discuss pipelines and closed business. These extrinsic motivators are a part of all successful sales organizations. In addition, most banks have invested significant sums of money in providing sales training for their sales teams. But, as many of these same banks have discovered, sales training combined only with extrinsic motivators produces limited results (except with high performers, who probably didn’t need the training in the first place).
The sales skills taught in most sales training programs are based on research about the sales behaviors of high-performing salespeople. These best practices are broken down into components that can be taught in a classroom setting-things like account management, sales call communication skills, rapport building, priority management, etc. But classroom learning does not ensure sales success in the real world. In most instances, salespeople leave sales training programs with a good understanding of the skills required for success. To become competent using the new sales techniques, they must practice the skills hundreds of times in real-life situations.
Unfortunately, when average-performing salespeople first start using new sales skills with real customers and prospects, their attempts feel awkward and unnatural. They may try the skills a few times, but abandom them if they don’t seem to work. “That may work in some markets, but it doesn’t work in mine” is a typical comment. So, these salespeople revert to their old, more comfortable habits within a short time. Properly designed, extrinsic motivators can help. For example, raising call targets and creating highly visible call reporting can drive salespeople to practice the new skills by creating an emphasis on making more calls. Of course, the underlying assumption in this approach is that practice makes perfect, while in reality, effective sales calls require so many skill sets to be fine-tuned that accountability alone gets you primarily quantity, not quality. Just practice is not enough. Mastering all the skill sets will take a support tool; for average performers, this means the support of a sales manag er’s ongoing guidance.
Let’s look at one example. All sales training programs teach some form of pre-call planning (checking the customer’s Web site, doing research on the industry using RMA data or other sources, reviewing any internal bank documents, etc.) and provide a planning tool–usually a form to be completed prior to an important call. The call-planning form usually requires specific information on the customer/prospect situation, issues that have emerged in recent calls, call objectives, needs to develop, and the next step to advance the sale. This information is critical for building effective call strategies. However, it does take about 20 minutes to complete an adequate plan. How many times does a salesperson do even this minimal level of preparation? “I’m too busy for all this paperwork” is a comment we hear constantly.
The research on highly successful salespeople shows a high correlation between planning a call and developing needseffectively and between developing needs and success in advancing a sale. Clearly, a better job of planning produces better sales results.
So, how do you get your salespeople to see the need and value in call preparation, to see that it’s time well spent? It goes beyond extrinsic motivators. It takes coaching, a key component of ongoing guidance. When sales managers make the time to meet with salespeople one-on-one to strategize an upcoming sales call and then to formally debrief the same call, more needs are developed and more sales are advanced. When a bank CEO or head of commercial banking asks for a call plan and then discusses call strategies the day before a call, call planning becomes “the way we do business.” When salespeople begin to see a correlation between call planning and improved results, when they see everyone from the top of the bank down making the time to plan their important calls, call planning increases dramatically. When the use of call planning becomes a part of day-to-day selling, call quality and sales results go up. In the end making more calls is good practice, but coaching drives call quality.
Sales training is a form of guidance. But the sales management support system dictates “ongoing guidance, delivered unrelentingly.” The qualifiers ongoing and unrelenting are key. Sales managers who make time to coach new skills, who coach important sales calls before the call, and who spend time coaching sales strategies (not just credit strategies) see sales results improve every quarter, every year.
Figure 1 demonstrates how making any strategy, tactic, skill, or behavior a part of day-to-day selling requires three steps:
1. Articulate the process you want the sales team to use (sales training provides a sales call model).
2. Build accountability to encourage “using” the new process (extrinsic motivators such as call tracking, pipeline reporting, contests, goals, incentives).
3. Use effective support systems that improve the quality of sales calls and drive sales performance (pre-call/post-call coaching).
Effective sales management requires a high level of structure and discipline over a long period of time. There are three steps you can take to improve sales call quality. These disciplines go beyond sales call training and are critical factors toward improving sales performance:
1. Identify key relationships and key prospects and stay unrelentingly focused on them. Clearly define your target market. Who are your best customers? What do your best prospects look like and where can you find more? Help your sales team prioritize their sales time and stay focused on the customers and prospects that you want, not just the ones that walk in the door. This clarity of direction and unrelenting focus will ensure that you retain key customers and develop the “right” new relationships.
2. Improve relationship planning. Proactive selling demands a well-thought-out sales strategy for each key relationship: in other words, a formal relationship plan. These plans are reviewed and “coached” by sales team managers, presented periodically to senior management and product specialists, and updated regularly. In high-performing sales teams, relationship planning is viewed as a key to long-term top-line growth.
3. Make pre-call planning the norm. Each call on a key customer or prospect is an important step in growing revenue. Make the content of sales calls important. Proactive selling is a planned and managed process. So are sales calls. “Winging calls” is not the way it’s done in high-performing sales organizations.
If you’re trying to improve the quality of the calls your sales staff are making-and generate top-line increases in revenue without sacrificing margins or credit quality-sales training is just one element of a well-managed sales process. Without the other key elements, its benefits will be short-lived.
[FIGURE 1 OMITTED]
Support Systems Extrinsic Motivators
* Clear direction, clearly * Challenging goals
* Ongoing guidance, delivered * Visible accountability
* Immediate feedback on performance * Monetary incentives
* Recognition of high performance
* Appropriate use of peer influence
[c] 2003 by RMA. Ned Miller is senior vice president of MZ Bierley Consulting, Frazer, Pennsylvania. Before his position with MZ Bierley Consulting, Miller was director of RMA’s Chapters.
Contact Miller at email@example.com.
COPYRIGHT 2003 The Risk Management Association
COPYRIGHT 2005 Gale Group