Sales force excellence is equal parts talent (people) and equal parts performance conditions. Do you have the right performance conditions in place? Performance conditions are defined as the environment in which I place my sales talent. A few examples of performance conditions are:
- Segmented territories with Ideal Customers/Prospects clearly identified
- Quotas and Compensation plans tied to individual territory potential
- Sales Management Curriculum and Certification Program
VPs of Sales are suffering from an age old belief that sales training will move the revenue number in the shortest amount of time. Our firm benchmarked over 1,100 companies and 83% had committed dollars towards sales training. The impact of time and money spent on sales training can be positive; we are huge fans of properly designed, customized sales training. We have seen a greater revenue lift when organizations focus on improving their performance conditions.
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Optimal performance conditions will allow the sales strategy to come alive. Below are 3 examples of how this problem is misdiagnosed every day. Perhaps one will resonate with you? Each example I will cover the problem, misdiagnosis and what the potential performance conditions problem could be.
Problem 1 — Average Selling Price has eroded over the last 2 years and you are not generating as much net profit on each deal.
Misdiagnosis: Reps are moving to price too fast and need to “sell higher”
Performance Condition Problem: You are approaching the customer segment with the wrong channel; the customer no longer values face-to-face selling and you can sell via inside sales. Less expensive, more efficient and greater coverage opportunity for this customer segment.
Problem 2 — Win Rates have dropped; same competitors are beating you more in head to head deals than they were 2 years ago.
Misdiagnosis: Reps need to be trained on competitive selling and handling objections.
Performance Condition Problem: Your Ideal Customer has changed due to gaps in your product or service portfolio. Re assess the attributes of an Ideal customer (size, industry, geography, etc) and the types of problems they are having
Problem 3 — Quota attainment has dropped 5% per year over the last 3 years due to increased sales cycle length and deals getting stuck.
Misdiagnosis: Train the reps on building a stronger business case to accelerate sales cycle velocity
Performance Condition Problem: You have increased quota each year without paying attention to territory potential. How can a rep with 2MM in potential and a rep with 5 MM in potential each have the same quota? Or perhaps the quotas have increased but the sales team is not provided leads? They are wasting time prospecting and qualifying, not selling.
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