CEOs Interviewed:

 

Marc Chardon– CEO of BlackBaud

 

Joe Payne– CEO of Eloqua

 

Patrick Brandt– CEO of Telligent

 

Steve Grimshaw– CEO of Caliber Collison Centers

 

David Mitchell- CEO of Global 360

 

Bill McGinnis- CEO of NTS

 

Keith Olsen– former CEO of Switch and Data

 

Fred Florjancic– former CEO of Safety-Kleen

 

Bob Verdun– CEO of CFI

 

Manny Medina- CEO of Terremark

 

Sales Force Effectiveness

 

Findings:

 

  1. CEOs should be focused on sales force competitiveness and developing effective sales strategies.  CEOs do not understand their true sales force competitiveness and true selling costs as compared to their competitors’.
  2. CEOs need to improve their sales domain expertise and focus on developing a trusting relationship with sales leadership.  Few CEOs have risen from the sales function and are inexperienced in managing this department. Yet, much of their success is dependent on informed management of the sales force.  Complicating matters is the fact that sales leadership has not spent time in finance, operations, etc. and do not present solutions supported by evidence.  The result is a CEO who does not trust the information fed to him/her by sales leadership.
  3. CEOs would benefit from an analytical framework to assess the sales force.  CEOs need clarity on which trigger to pull:  “Should I hire a new sales leader, develop different channels, increase the training budget, purchase technology tools, cut prices, target a different market segment, etc.?”
  4. CEOs would be wise to improve the way upon which expectations for the sales force are set.  More so than poor execution of sales leadership, missed expectations are created by a flaw in how expectations are set.  To set accurate goals, more than anything CEOs need account-level data supplied directly by customers and prospects.  Too often, CEOs are relying only on bottom-up data provided by the field and top down views supplied by marketing.
  5. Sales resource allocation represents an untapped opportunity for CEOs.  Best-in-class companies view sales resources as an investment and allocate resources based on return on sales.  Median performers are focused on affordability over profitability and view the sales force as a cost center.  Best-in-class companies realize that last year’s numbers are not a reliable guide when creating this year’s sales plan.  New products are released, the economic conditions change, the competitors make strategic moves, the customers alter their priority list, etc.  Leading sales forces discount history and use forward looking simulation models that project what is likely to happen.
  6. CEOs need to help sales leaders determine priorities.  Sales leaders tend to bounce from one major project to the next with little consideration for disruption costs.  CEOs can put an end to this by helping sales leaders understand how best to prioritize their key projects and estimate the impact prior to engaging.
  7. Revenue concentration requires CEOs to be more active in sales management. The 80/20 rule, where 20% of customers generate 80% of revenue, is alive and well in most companies.  This poses a great risk to company performance.  As bloated sales forces are rationalized, CEOs should be actively engaged in any territory changes to insure the company does not lose any top customers in the process.
  8. There is a shortage of “A” player sales leaders.  The average tenure of the head of sales is 19 months, requiring the CEO to personally spend more time leading the sales force.
  9. CEOs would benefit from establishing a sales management cadence.  CEOs who manage their sales forces consistently with world-class practices have a natural rhythm of engaging in the planning of sales force execution.
  10. Developing Customer Intimacy as a sustainable competitive advantage is possible through world class sales force execution.  With low cost supply and product differentiation already tapped out as sources of competitive advantage, CEOs are left with an unrealized asset- the sales force.