Leading Change in Sales Organisation

Over the last seven years we have helped more than 25 large industrial, IT and consulting companies in their journey towards a world-class sales organisation. These experiences have led us increasingly to believe that sales is undergoing a major change, and that there are particular challenges facing sales organisations in managing change. In these matters, a great deal is required of HR and sales management. With this customer newsletter we will endeavour to detail some of the key issues that arise from managing change in a sales organisation. Hopefully, they will encourage you to take action!

SALES IS CHANGING - WHY?

One top director with whom we met, from the purchasing organisation of a global industrial business, noted: "It would be easy to be a salesperson, one could just praise one's own products and solutions. But I should be able to make shrewd decisions from the point of view of the entire organisation, that have effects on our business for many years, and, of course, also on my own position."

Professional purchasing organisations have for years already developed their negotiation capabilities. They segment their suppliers by gauging mainly two core concerns: 1) the replaceability or uniqueness of the services and products produced by the supplier 2) the importance of the services and products produced by the supplier, strategically or cost-wise.

However, it seems that the greatest difficulty in buying is assessing how much and in what way different producers are able to produce value. Often, the sales organisation is unable to describe to the customer tangibly enough in Euros the value that their company produces. Indeed, the key proficiency in consultative sales functions is sales people's ability to describe in very concrete terms, how the products and services produced by the company help the customer to save on their own process costs, to sell better or more, or to strengthen their balance sheet management.

These benefits that the company produces are often only properly understood in the customer's accountable line organisation - not necessarily in its purchasing organisation. For this reason, high-level consultative sales activities feature systematic and goal-driven orientation within the customer's organisation.

More and more often we run into companies' strategic work producing definitions of competitive advantage, such as "environmental know-how", "global and reliable operator", "application expertise", "all from one supplier," etc. Most of these are just rhetoric, and their effectiveness on the client is woefully small. It remains unconsidered what these competitive advantages mean to the customer and how sales should sell them in order to "uncover" the right kind of needs in customers.

CHANGE A BIG CHALLENGE FOR HR AND SALES MANAGEMENT

In many organisations, individuals have risen into sales management who have achieved excellent results in their own sales work. Precious little attention has been paid to sales' management, direction, and measurement, and traditional quantitative metrics are still used for directing operations. At the same time, more and more customers are searching frantically for suppliers, or even partners, who are able to provide them with genuinely tangible value. If the supplier cannot produce or demonstrate this value, they are often relegated to the "make them compete hard"-segment.

Change places enormous demands on HR and sales management to identify the organisation's sales capabilities, to assign sales people according to their selling skills, and to coach and develop them towards consultative sales activity. In most organisations, however, this assessment and coaching is done on a notional basis, because the tools with which sales expertise can be objectively assessed are missing. HR managment, generally speaking, view managing change at the level of the individual. A sufficiently deep insight into the assessment of the sales person's abilities, however, is often lacking, and the end result is generalised coaching programs, in which the development of requirements for giving feedback from sales management is attempted in isolation from those things that should rightly be evaluated and measured in the sales capabilities of the sales person or expert.

HR leadership would have much to give, for example, in assessing the capabilities of individuals and in the development of sales' recruitment process. At Precedo Consulting we have indeed developed new services for these areas.

MANAGING CHANGE IN THE SALES ORGANISATION AT THE LEVEL OF THE INDIVIDUAL

Our experience of more than 25 significant change processes in large sales organisations indicates that, on the individual level, the realisation of change calls for four core things. The individual's behavior will change if the following are true:

Commitment. The key management and the most important opinion influencers of the organisation are visibly involved. This is important not least because, in a number of organisations, change is a permanent condition, and the majority of individuals are willing to change their behavior only if the leadership and other respected key people are clearly committed to change.

Insight. Change in behaviour requires that individuals truly understand why change is important. In practice, we have seen that often only one or two insightful leaders profoundly understand the market change described above and are also able to communicate the change to the entire organisation. We must admit that sometimes we ourselves as consultants have also erred in this and been forced to step back a little to confirm the basis of change by means of 'awareness workshops'.

Sales Process, Tools and Metrics support change. Change in a sales organisation often requires a thoroughly new and tangibly defined sales process and new sales metrics. Sales has long been based on the individual's personal abilities, which managers have had difficulty grasping objectively. The concrete process of making sales, adequately simple tools, and new metrics are important instruments for catalysing change in the organisation's "average performer".

Skills and Coaching. The move towards consultative sales is an extremely big behavioral change for most people, even those who have worked in sales for a long time. The change very rarely occurs, unless salespeople are given new skills and unless coaching strongly supports the change. Change in an individual's skills often gets underway with small improvements: for example, like when the salesperson tries to ask the customer a little more about their needs. In our experience, however, high-level consultative sales also necessitates a process of change on the individual's level lasting about 3 years. The journey is long, but if its progress can be measured objectively, it is an extremely rewarding journey as much for the individual themselves as from the sales organisation's point of view.

If your challenge is sales capabilities' assessment, recruitment or, in general, the management of change in a sales organisation, we will be happy to begin a conversation with you!