Getting to the first million dollars in sales
Unless you are one of the few companies with an inherent viral model, building a sales team takes a lot of work. We have seen founders and CEOs make two consistent mistakes (in previous careers we were guilty of these ourselves):
- Trying to hire a sales team before you prove your model yourself
- Creating a commission plan before a sales model
As you build your sales team, here are a few simple tips to maximize your chance of success:
- Do-it-yourself: “Good sales people don’t go to companies with un-proven sales models”. We all think our product / service is the best and should sell itself. But until you know the pitch, objections, pricing strategy… you shouldn’t turn this over to a salesperson who lacks the authority necessary to fix issues uncovered in the sales process. Even if you could attract a sales rock-star at this stage, they likely would fail. So roll-up your sleeves and start selling.
- Hire a Closer First: Once you have begun to figure out the sales model, don’t immediately turn it over to someone else. Start building your sales team by bringing in people to close the leads you generate.
- Pay Bonuses, Not Commissions: Resist the urge to pay people on a commission basis until the sales model is refined. You need to know your team can hit targets consistently before tying them into a commission model. If you adopt a commission model too soon, you are apt to spend your time managing compensation expectations rather than improving the sales model. Instead, focus on discretionary bonuses for the time being.
- Build Your Marketing Funnel: Before your sales model is finished, you need to develop a clear lead generation model. This doesn’t require cold-calling and there are a number of great guides out there (i.e. a recent book by our friend Aaron Ross)
- Create a Simple Commission Plan: Now, finally you are ready for a commission plan. But, make it simple – you should be able to track it on the back of a napkin, not a whiteboard.
We wish you success as you grow your company. Getting to the first million dollars in sales is the first challenge and we encourage you to focus on sales rather than sales compensation. As you scale, sales productivity will become a challenge and opportunity. For more information on how prialto helps sales teams become more productive, visit www.prialto.com.
The Top Sales Mistake: Turning Your Sales Stars Into Data Clerks
Over the past ten years, I have rolled out CRM systems at four different companies and have personally witnessed the power of CRM to:
- Improve management of customer and prospect relationships
- Provide better sales visibility
- Improve communication across a sales team
However, I also know full-well the statistics on CRM. Gartner estimates that over 60% of CRM implementations fail after the go-live date. I recently spent an evening talking about sales productivity with a leading sales rep for a Bain Capital portfolio company. What I heard shouldn’t surprise anybody but hopefully it is a wakeup call.
- Hunters aren’t built to enter data: We all know successful salespeople are wired differently. But, in a quest to fulfill the promise of new systems, we try to turn our team into desk-jockeys. This sales rep shared with me that his entire team feels like “… well paid clerks.” and that he “… didn’t get into sales to do admin.”
- Sales teams don’t see the promise of CRM: Star sales people see sales as an art and CRM as ‘big brother’. Like the sales rep I talked to they believe, “I hit my numbers and don’t see the reason to document in Salesforce just so they can monitor me.”
- Sales training isn’t working: Despite the investment in systems, stars prefer to be lone wolfs. With few established processes, sales teams end up with a few rock stars and a ton of new sales reps struggling to figure out the ropes. This sales rep shared with me, “Our company is a total mess. There is a huge learning curve for new reps and we lose many of them quickly”
No wonder that according to Forrester the average VP of sales lasts 18 months. With a sales team that sees no value in the systems, the worst thing you can do is add more process. So how can we stop this cycle and improve our sales productivity? Here are two, not-so-revolutionary, ideas:
- Stop having your sales people enter data they don’t see as valuable
- Free your salespeople up to focus on what they do best
While these ideas sound simple, they take some effort to implement. Here are a few basic steps you can take to get started:
- Review your sales administration processes: Analyze each process to understand a) the level of specialized knowledge and b) the priority for your business
- Focus first on those processes easy to standardize: Processes such as CRM data entry, appointment setting, prospect research, lead and contact management, travel, expenses, and reporting are great places to start.
- Create a true sales support function: Inside sales and lead gen are not focused on increasing the productivity of your sales team. They are measured by their own metrics. To solve your sales challenges, you need to provide your sales reps with a support system. We find the best way to achieve this is to integrate assistants into your sales team’s processes and track the impact on your reps productivity.
- Commit your organization to success: The benefits of freeing up your sales team to focus on sales can be powerful. A study by McKinsey of a global manufacturer showed an average gain of 15% more time for selling and decreased cycle time for internal sales processes of 20%. But, to realize the potential, an on-going commitment, technology platform, and training are required.
Prialto (www.prialto.com) works with growing companies to focus their sales reps on key client interactions. By integrating assistants with sales teams, Prialto helps improve sales productivity while, at the same time, providing better visibility into sales pipelines. To discuss how we can help you re-engineer your sales team, contact us at 866.910.8440
One phone rule will save us all time
One simple cell phone etiquette rule will save us all many hours.
You will recognize the context:
Say you are driving north down Highway 101 from Palo Alto to San Francisco at about 3:00 PM on Friday afternoon. You dial your friend in New York and reach him as he is heading home to rest before going out to dinner. He’s on the E Train.
You are in the midst of an important discussion. And, then, just before he heads into Brooklyn Heights, he says “If I lose you going under the water, I’ll . . .” You hear silence, and, then, silence. . Gone! Lost connection, and who knows exactly what the last words were your friend heard?
You wait for about how long you know it takes for the E Train to resurface on the other side of the East River. Here, then, is the sequence of events that follow:
- You redial
- You hear a busy signal, and hang up
- You see a message waiting on your cell phone screen
- You are near certain it is from the friend you were just speaking with saying “tag, I’m trying to call you back,” so you redial again
- You think you are about to connect, but you hear the call waiting signal. You check your screen for the incoming number. Sure enough, it’s your friend calling you back again. You try to click over, but he’s already gone back to voice mail.
- You hit the red button several times to terminate any call left connected
- You wait for your friend to dial again, but nothing happens because now your friend is also waiting
- You are both probably frustrated by now. You hit the green button again to dial, but now all the cells on Highway 101 are clogged with people planning their Friday evenings. Your call takes several minutes to get through and now you can hear that your friend is on the line with someone else.
- “Forget it,” you think, “I’ll catch him tomorrow.”
Who should call back and who should hold off?
Here’s the etiquette:
Don’t spend time guessing or presuming whose phone or location was responsible for the lost connection. That’s impossible for either party to know.
Whoever initiates the call should dial back, regardless. It’s simple and straightforward. You’ll both always know who that is and you will avoid a lot of confusion and wasted dialing and waiting.
Taking emotion out of corporate email
How about a corporate policy mandating against emotional communication in email? Michael Keck recently informed me that this is the rule for internal communications over at Algentis.
Michael and team want to stay focused on serving their clients. They DO NOT want to waste time parsing email sentences to decipher any hidden meaning behind the written words.
The no subtext rule
Their solution is a no-subtext rule: Don’t write with emotion and don’t waste time looking for it. If a manager wants to know when he will receive an overdue deliverable, he will write, “when will you send that deliverable?” He will not spend time crafting a more tactful, but easily over analyzed, sentence like, “I just wanted to check in on when you’ll be able to get that deliverable to me, as I was under the impression you would send it to me yesterday.”
The policy probably won’t work with customers, and, even internally, it requires colleagues to adhere to the same principles that make a marriage work well: Assumption of goodwill, complete forgiveness for past disputes, etc.
Don’t read between the lines
If a manager writes to a colleague “when will you be arriving today?” the receiver of the message must avoid reading any innuendo into the simple question. The point is for the reader not to waste time thinking “I wonder if he thinks I’m late a lot.” The Algentis policy says such nuanced discussion will be left out of email and transmitted only in verbal communication, a form far less prone to misunderstanding.
Higher personal productivity is the benefit
I’m not sure if the tip is a good one for all teams. Operating among diverse groups may require a commitment to extra communication. But adherence to the no-subtext rule is probably helpful to any individual reaching for higher personal productivity. Imagine unilaterally telling coworkers that you’ll no longer spend time deciphering emails with emotion: The information only, please!
You may miss a bit of the meaning and connection. But spending less time reading between the lines may save enough mental energy to make it worth the tradeoff.
Finally a way to connect your laptop to the web via your BlackBerry
For two years I had a Verizon PC card to give me web access for my HP laptop. The card was free, but the service cost me about $60 per month—a big monthly cost. The connection was fast and the ability to connect from client locations was an important benefit. But the $60 per month ($720 per year) really irked me, so I ended up dropping the service.
Now I finally found a way to get the mobile web connection I want on my laptop without the high monthly fee. I recently download the Tether app for BlackBerry. For a one-time fee of $49.99 I can connect my BlackBerry to my HP laptop via a USB cable and get the web and email from almost anywhere. There is no additional fee beyond the BlackBerry data plan I already have from Verizon.
Not only do I save a bundle, but also I score a victory for competition with the big carriers.
What: Tether app for BlackBerry
Where: http://tether.com/
Price: Free trial available, full version is $49.95 one-time fee