Sales: What Works Now

In the end nothing excites salespeople as much as unlimited earning potential. Translation: no cap on how much money they can make, even if it means your number one salesperson becomes your highest-paid person. If you can illustrate to sales reps how they stand to increase their take substantially as the economy picks up, you've got their attention. McElaney tells the salespeople he hopes to snag from bigger companies, "There's no cap on what you can make and no such thing as sales territories. It's open season." That message goes over particularly well right now. "Freedom is a powerful enticement," he says.

Q: I know I need help, but I've tried to hire salespeople in the past, and they never last. Where did I go wrong?

Lots of entrepreneurs expect salespeople to just do their thing with little help from the top. Or they wonder why all salespeople can't just sell, say, the "Microsoft way." Sales veteran Marty Sunde understands that perspective. He spent 18 years at IBM, including a stint as vice-president of Big Blue's North American field operations. To this day his business friends bug him for the "IBM solution" to sales management. Instead, Sunde takes his buddies through the basics.

First and foremost, are the sales goals realistic? That's what he asks when entrepreneurs complain that their salespeople are paid too much and work too little. "A big source of the problem is the company owners haven't forced themselves to sit down and say what their expectations are for the sales function," Sunde says. "It's not an indictment of these leaders. They're so stretched. They want at least one area to run itself."

Sunde has an exercise for you: "Mentally assign yourself the job of lead salesperson. Ask yourself, If you had 100% of your time to devote to sales, what would you do? Who would you talk to? Where? How long would it take you to convert an order, and how big would the order be? I force my company-owner friends to think this through, and I take notes for them. I get them to describe the selling process and assumptions they're making about how products will be received by potential buyers. If you did this many sales calls a day, would you get burned out? How much can one person handle? In other words, you need to ask how much your sales clone is worth to you. I have to force company leaders to quantify all this. Then they realize that it would be wonderful if they could get someone who could do 80% of what they could do personally."

Q: I need everybody at my company to be thinking about sales. How do I encourage activities that help bring in new business?

Make those goals part of your modus operandi. At Scientific & Engineering Solutions, in Annapolis Junction, Md., "the company culture is to have everyone bringing in business," says CEO Reggie Daniel. No matter that most of his 130 employees are tech heads, not sales jocks. Through the initiative of one technical staffer, Steve Newcomb, the company turned a small contract into one that landed $700,000. Newcomb's reward? A trip to the Super Bowl. And oh yeah, he collected the commission on the sale. Daniel says he had no problem paying Newcomb a large bonus check. "He did it all, and it's not his job to sell," Daniel says. Newcomb recently got a promotion, too. With employees like Newcomb it's no wonder the company has grown so fast -- 30% last year, to $21 million in revenues.

REGGIE DANIEL: "Our company culture is to have everyone bringing in business."

"I like to see technical people spread their wings," says Daniel, "and they should have access to the business world." His three salespeople and a selected 15 nonsalespeople get paid commissions or bonuses based on the profitability of the sales they help close. While salespeople rely on commissions for about 50% of their compensation, the tech folks have much less income at risk -- at most 25% of their yearly pay. "At first it makes them nervous," Daniel admits. "But for some people once they taste [incentive pay] they do very well."

Q: How does a young company get a break in this environment? Clearly, having a good product isn't enough.

You're not kidding. Talk to Jana Machin and Julz Chavez, of Get Real Girl Inc., in San Francisco. Their product line -- sports-action dolls that look as if they could give Barbie a run for her money -- has won kudos in the toy world. What's more, some of the best independent reps in the industry are pounding the pavement for Get Real Girl. In the past year the sporty dolls (Skylar, the Snowboarder, and others) have blazed their way into national chains such as Target and Toys "R" Us as well as onto the shelves of hundreds of independent toy stores. And yet Machin, the company's president and CEO, and Chavez, its conceptual designer, will quickly tell you those accomplishments are not enough.

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