Is Reading this post a Good Use of Your Time?
Reading this post, and those that follow in the series, could be highly relevant and meaningful to you, both personally and professionally. It could also be a waste of your time. Read through this first section. If it sounds familiar and deals with issues you care about, keep reading. If not, you won’t have invested much time and can put it aside.
Addressing the Revenue Growth Gap
For most companies, the need for profitable revenue growth never stops. Unfortunately, the growth of salespeople does. As the following quote points out:
That creates a revenue growth gap. Filling the gap with quantity - hiring more salespeople - can be costly, inefficient, and doesn’t fix the underlying deficiencies. Filling the gap with quality - improving the sales people we have - has been elusive. We cycle through sales training programs, processes, and technology aids. Often we get short-term bumps that quickly fade in productivity rather than seeing lasting change that fills the gap.
Both the Pain and Gain are Big
A study by the Sales Executive Council claims that the A Players - the 8s, 9s, and 10s - are three to four times more productive than average performers, the 5s and 6s. McKinsey chimes in with a study that says the A players tend to improve sales by 52%, the B players by 4%, and the C players actually decrease sales by 15%.
Nobody tries to hire C players! We start out believing we are hiring at least 7s. Yet on average, if you hire five salespeople, all of whom seem like excellent candidates, you get one who is really good (if you are fortunate), two who are OK, and two who are underperformers.
It often takes six months to a year to figure out who is OK and who is an underperformer and then fire the underperformers. To state the obvious, underperformers cost you a lot of money in both direct costs (wages, expenses) and opportunity costs (the time you spent hiring, training, managing, and firing that could have been spent elsewhere and the forgone sales you expected to get). Would $100,000 direct costs per underperformer seem high or low to you?
The people who are OK are a blessing - and to some degree, a curse. At least they are OK! Compared to the underperformers, that’s a blessing. Most of us welcome solid B players. However, people who are OK tend to stay OK. They don’t progress to become A players. That commits you and your company to being just OK and typically results in unsatisfactory revenue growth.
What about the A player? If you have one or more, thank your lucky stars. Obviously, you want to keep an A player happy; heaven forbid they should leave. Certainly one temptation is to make them a sales manager. You then expose yourself to the double whammy - the A player’s sales go down while the B and C players’ sales remain OK or lousy. The A Player, as good as s/he is at sales, may not translate that individual success into making others successful. The all-star athlete is not necessarily a good coach.
The “Duh” Factor
There is an obvious payoff if we can “move the middle.” If we can make average performers - the 5s and 6s - just move to a solid 7, they can produce twice as much as they used to. Because there are lots of these people, getting many of them to make such a move pays big dividends. And it is an easier move than, say, the move from 8 to 9. Perhaps we can even “steal” money and time to invest in this move by identifying and replacing C players earlier than normal.
Understanding the move isn’t difficult. Realising the move has been problematic.
The Key Question
As organisations - small, medium, large, or mammoth - what could we do differently to change the game and improve the results? Is it possible to consistently turn OK performers into at least 7s, keep 8s, 9s, and 10s growing and happy, and identify and get rid of underperformers much more quickly? Not 100% of the time, of course, but with a much, much greater frequency than your current experience?
We answer that question with a qualified “Yes.” Yes, if you are willing to commit to and execute four key steps. We are going to explain those four steps. We are going answer the question, “What’s different this time? Why can companies do this now if they haven’t been able to do it before?” And by the end of this series, we expect that you will have enough information to choose one of the following responses:
This resonates. I’d like to explore how, if at all, it might apply to my situation.
Interesting, but not enough for me to take action now. Keep me on your mailing list.
Are you guys nuts?
In Part 2 of this series - Four Steps to Consistently Grow Sales by Consistently Growing Your Salespeople - we’ll begin to list the four steps, talk about them at a high level, and then go into each in more detail.
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About the Author
Throughout his long and distinguished career, Mahan Khalsa has been dedicated to helping people get significantly better at sales, and he continues to be instrumental in pushing the envelope on the mindsets, skillsets, and toolsets that make getting better both real and never-ending, both for individuals and for organisations.
Mahan is co-author of Let's Get Real or Let's Not Play: Transforming the Buyer/Seller Relationship. He is the founder of the Sales Performance Practice at FranklinCovey and the originator of the Helping Clients Succeed body of work, employed by many of the world's top companies and taught in more than 40 countries and 10 languages. Mahan has worked directly with clients to help create and capture billions of dollars of value - and to do so in ways that lead to greater trust, better relationships, and increased future value.
Mahan has three key beliefs that drive his passion - personally, and with colleagues and clients. The first, garnered from his extensive research in the science of expert performance, is that everything you need to know to be great at sales is learnable - you just have to be willing. Second, the amount you can learn and the degree to which you can improve is infinite. Third, what you learn to be great at sales contributes immensely to who you want to be as a human being.
Credits: Geoff Colvin, Talent Is Overrated: What Really Separates World-Class Performers from Everybody Else (New York: Portfolio/Penguin Group, 2008).
The Sales Exceutive Council Member Poll, 2003; Sales Executive Council research, Sales Leadership Roundtable reserach
Image Credit: Iron Man Movie, 2008, Paramount Pictures