“How do I compare against my peers outside of my company?” asked one sales manager last week. “Tell me what I need to do to get better. How can I sustain results so I don’t get fired!” are common responses.
“Well, where are you (and your sales team) on the Sales Management Maturity Model?”
The Sales Management Maturity Model depicts the movement a sales manager and their sales team through several levels of maturity. Starting with a state of “chaos‟ and eventually assuming a state of predictable performance, each one of these growth and maturity stages is represented by certain attributes that can be measured to sustain productivity. Your determination on the model depends on several factors:
Type of industry you are in is key to determine which level is optimal for your current state:
- New technology/innovative industries (or sub-industries) can be effect in a Level 1 Chaotic State. Mature industries need predictable performance (Level 5) to sustain results.
- Think like this: If you are selling Office Supplies, you need to be a Level 4 or 5 to consistently grow revenue. Renewable energy can be very successfully initially in a Chaotic (Level 1) state.
Experience and tenure are critical in your ability to move up the scale:
- Have a lot of ‘sales rookies’ on your team? You better be a Level 3+ or the performance will slip.
- In contrast, if you have a lot of ‘rainmakers’, a Level 1 or 2 state would be ok as long as there is no turnover.
Product maturity and market share are critical in diagnosing the correct level:
- Trying to sell Ball point pens? If you are not at a Level 5 sales management state, go do something else. It will be a tough road.
- Pitching 3 D holograms? A Level 1 Chaotic state will be enough to get you established in the market
Industries, organizations and products change consistently. What is today’s hot product is tomorrows commoditized purchasing agents dream. Take Yahoo and Groupon:
Sixteen years ago Yahoo was in a chaotic sales management and sales force state (Level 1). They were in the ‘hot’ internet industry and could do no wrong. Business flowed to them….and ‘rainmakers’ were selling business so fast they didn’t have to prospect.
Today, advertising on the internet is the norm and commoditized. They need to move up on the maturity model. Process needs to be implemented, adopted and reinforced. Performance needs to be tracked. Leading indicators needs to be discussed unlike lagging indicators.
Last year the ‘daily deal’ industry was BOOMING. Groupon (and their competitor Living Social) could do no wrong. They lived in the ‘Chaotic’ state. Both companies, trying to grow revenue, hired sales people. Tons of sales people:
- Groupon went from 201 sales reps to 990 in one year
- Living Social jumped from 191 to 700.
One year later, 1/3 of all ‘daily deal’ sites have shut down. The cost to acquire a new customer tripled in one year. The industry has begun to mature. There sales force needs to mature. If they don’t get their sales managers out of Chaos into a Defined or Reportable state in the next 12 months, there sales will begin to level out or fall. Sales productivity will decline. Yep, there sales managers will begin to miss goal. Compensation will fall…..you get it.
How do you move up the Maturity Model?
Three ways Sales Management can move up the Maturity Model:
Design, Develop and Implement a Sales Process mapped to a Buying Process.
The foundation of any sales strategy is a well-defined sales process that is adopted in the field. Sales Managers can then coach and develop to the process, improve productivity and begin to move up the model.
Implement a Sales Performance Management System.
Baseline the Key Performance Metrics by identifying how to measure these metrics accurately. Use these baselines to gauge performance as you mature. Make sure you understand what the reasons for improvement are.
Stick to the Sales Management Fundamentals.
Regular cadence around one on ones, sales meetings, field evaluations and coaching to situational development is key to increasing maturity on the model. Adhering to seeing customers, making sure sales reps spend the majority of their time selling and measuring leading indicators (funnel depth) vs. lagging indicators are essential to success.
Where are you on the Sales Management Maturity Model? Baseline your current state. Assess your industry, experience and product set. Determine what will need to happen in 2012. Start planning now….
Your team is counting on you!