Perhaps the most misunderstood job in small companies is that of the sales manager. It is so misunderstood, in fact, that it is often the last management slot to be filled. As a company grows, specialists are hired to handle research and development, engineering, accounting, and so on, but sales stay in the president's office, especially if big contracts or big customers are involved.
There is, of course, a reason for this reluctance to delegate responsibility for sales -- namely, the critical importance of the top line on the income statement. Unlike industry giants, smaller companies seldom have a base of "automatic" sales that just seen to flow, month in and month out. For that same reason, a sales manager, once hired, is often expected to handle key accounts personally, while trying to manage the sales operation at the same time. The paradox is that no company can grow to its potential until sales becomes a managed function, instead of a manager's duty.
Sales managers should never manage sales. They should manage the people that produce the sales. The distinction is a critical one because, in order to build sales, a company has to invest in salespeople. "Invest" is the key word here. Selling costs are indeed investments, just like money spent on research and development or equipment, and they should be evaluated in that light. If, say, you invest $60,000 for a sales representative in one area, you should have some idea of the business that you expect to generate and the amount of time the process will take. Similarly, if another area is very profitable, the question is, should you be reinvesting that profit by opening new territories?
The same logic applies whether you go with independent sales representatives or a direct sales force. With reps, your sales costs will be a constant percentage of sales, and so budgeting and cash flow may be easier to manage. On the other hand, a direct sales force gives you more control. But either way, you need to invest in the people who are selling. Those people, in turn, must be managed. And just as there is more to selling than a shoeshine and a smile, there is more to sales management than being a supersalesperson.
The most important element of the sales manager's job is the selection of salespeople. There is simply no substitute for high-quality raw material. Forget about budget or time constraints: economies in this area will almost always come back to haunt you. An organization forced to hire the "best available" talent is an organiztion headed for disaster.
The alternative is for the sales manager to undertake an unending talent search. Patience and persistence are the watchwords. When a superior candidate shows up, that's the time to hire, regardless of vacancies. This does not mean that decisions need be made hastily. Even the most valuable candidate can be kept on ice for 30 days while the first flash of enthusiasm fades. Indeed, it is not unusual, or excessive, to take 60 days and four interviews to confirm that a candidate is right for the job.
So how is it possible for a sales manager to do a thorough, disciplined job of recruiting if he or she is expected to be out selling the company's products? Clearly, it is not possible.
The sales manager is also responsible for training, something that many smaller companies think they can't afford. Instead, they try to "buy experience," hiring "Xeroids" or veterans of IBM or P&G. But big-company salespeople are not necessarily the best recruits for small companies. Besides, sales training is far less time-consuming and costly than you may think.
The secret is to train salespeople the way surgeons are trained: see one, do one, teach one. Shrewd sales managers often team up recruits with middle producers in the sales force -- not the top producers, who often take a lot of shortcuts that work well for them but are not transferable. Customers will also help train new salespeople by letting them observe their businesses for a few days.
As for training materials, there is absolutely no reason that a company can't generate its own. To create an orientation manual, the sales manager can simply have some recruits keep daily journals of impressions and facts, in prose, for their first month on the job. Similarly, field salespeople can write the training manuals by putting together case studies of actual accounts.
Using such methods, recruits can be brought up to solo speed in a few weeks, or even days, no matter how technical the company's business may be. But this will happen only if the sales manager puts in the time and effort required to guide the training process.
On the other hand, sales management does not include developing people. They must develop themselves. A sales manager is paid for cheerleading, not quarterbacking. Granted, new salespeople may require a limited amount of coaching -- less so if the level of incoming talent is high. But even recruits with zero experience -- for example, those directly out of college -- can become productive in a few weeks with a well-managed program that rewards early success with high recognition.
Bear in mind that almost all successful salespeople have one thing in common: high ego drive, coupled with a positive mental attitude. The sales manager's job, therefore, is to feed those insatiable egos and promote those positive thoughts. For junior people, that means treating minor contributions as if they were major accomplishments. The truth is that new recruits often need an inordinate amount of encouragement, so much so that some managers may feel foolish giving it out. Nevertheless, that's what it takes to put together an effective sales force and build sales.
For senior people, of course, you and your sales manager have to be more creative in recognizing accomplishment. The strategy is fairly straightforward, based on a simple fact: salespeople, like most of us, work for love and money, and they seldom get enough of either. Accordingly, the way to get the most out of them is to shower top producers with affection, perks, cash, and "recognition gifts" -- the custom-made awards (rings, trophies, framed letters) that acknowledge their special contributions to the company.
In this regard, one effective, and underutilized, sales builder is the company car. The car has long since outgrown its function as trnsportation. Today, the salesperson looks out at the hood ornament and sees his or her image. What's wrong with letting your top people drive Lincoln Town Cars? If Mary Kay can put powder-and-paint sales reps into pink Cadillacs, why can't you put the people who guarantee your company's income into something that reflects their contributions?
The point is that sales management demands a reward system designed with the needs of salespeople in mind. You and your sales manager should not make the mistake of building a system around your own needs. Someone may be a great shot with a rifle, but -- when hunting ducks -- the duck dictates that a shotgun be used.
It makes no sense, for example, to have salespeople performing administrative chores, a popular pastime at big companies. How many Fortune 500 salespeople say that they take Friday to do their paperwork? Businesses operate on Friday. Why turn salespeople into clerical workers one day a week? When that happens, a company succeeds only in cutting productivity by 20%. Let your sales manager do whatever must be done, but don't have salespeople working four-day weeks.
By the same token, it is wise to avoid the big-company practice of equipping salespeople with personal computers, thereby reducing them to "scope dopes." These highly labor-intensive machines are not selling tools.If you want to invest in technology, your sales manager can always get car phones for salespeople and let them make appointments, telephone in orders, and impress their customers while on the road. Again, the important consideration is return on investment, not cost.
The care and feeding of salespeople aside, the sales manager must also look after the staff that provides sales support and customer service. That staff is like the ground crew for a fighter squadron. A company simply cannot afford low skill or high turnover in this area. The challenge for the sales manager is to build this group of employees into a team. Inside people have to spend time on the road, and salespeople have to learn to depend on the support people.
In addition, the sales manager has to watch out for the mistakes that can undermine the sales effort -- for example, poor handling of telephone calls. Anyone who answers your company's phone has the power to screw up your biggest account. No call should ever be answered with the company's name and a quick "please hold." The solution is to establish rigid telephone procedures, getting whatever hardware or backup staff may be needed to ensure that callers are treated well.
Last but not least, a sales manager must be a field person, visiting salespeople regularly, spending time with them, walking the ground to see how things are going. In sales management, there is no substitute for field time. Written reports are valuable only to those who write them. They seldom benefit the reader.
Sales analysis, on the other hand, is a matter of simple arithmetic. You add up the numbers and look at the results. No computer program is necessary for that. If you want a pie chart, draw a circle with a crayon and a paper plate, and then fill it in. When the numbers are good, the sales manager should so inform the people who produced them. When the numbers are not good, he or she must act swiftly to revive the sales effort with new blood. People seldom change dramatically. An organization is improved over the interview table, not by spoon-feeding and coaching.
These, then, are the disciplines of the sales manager -- recruiting, training, motivating, supporting, evaluating. It is a demanding job, and one that can't be done part-time. Is it any wonder that sales managers who sell generally do a poor job of managing? Or that companies without sales managers soon rub up against the limits of their growth?
True, the founder, president, or chief executive officer may have a fair level of personal selling skills. That's because the CEO has often had to sell the company's concept, whether to attract customers, investors, or key employees. But even a chief executive with exceptional selling skills seldom has the time or inclination to manage a sales force. Besides, sales-management skills are very different from selling skills, and talent in one area does not necessarily indicate talent in the other.
This is not to suggest that it isn't important for a sales manager to have some sales ability -- but only to understand the function, not to dazzle the troops or to knock off big orders. Top salespeople tend to be a breed all their own. They should be left to do what they do best, and should be rewarded appropriately with perks, cash, and inordinate amounts of praise and visibility. The best sales managers, on the other hand, often come from the middle group of salespeople. What they do best is what all managers must do well: they know how to manage people.
That, moreover, is how they should spend their time.