Strategies Of Winning Sales Organisations

1. When we give price concessions, we always get comparable value in return
   
   Forty percent of WSOs - but only 20 percent of other organisations surveyed - say that when they give price concessions they always get comparable value in return.
   
   There's nothing wrong with discounting per se, but only if you get something of value in return. The problem with most discounting is that salespeople often do it just to get the sale. Strike a balance. Make price concessions a quid pro quo - and never, ever discount unless you get something of equal value in exchange.
   
   Otherwise it's lose-win, not win-win. We have found time and again that top sales organisations know when they should be talking about price concessions, and when they shouldn't. On the other hand, less successful organisations tend to discount too early because they're afraid of losing the deal - and they don't have a good grasp on a solution for the customer.
   
   As big companies sharpen their buying processes, WSOs are finding new ways to differentiate their products and services - and get comparable value in exchange for price concessions. Successful methods include:
   
   
   
   • Getting payment in advance
     
     
   • Extending the length of the contract from three to fiveyears - or extending it indefinitely
     
     
   • Stocking three items of shelf space instead of one
     
     
   • Stock more and/or different stock keeping units (SKUs)
     
     
   • Reducing service levels, such as making the help desk available five days per week instead of 24/7
     
     
   • Eliminating a service from the contract, a service that costs you real money or manpower. For example, charge a fee for each service call instead of including service in the contract
     
     
   • Charging extra for delivery, installation or consulting
     
   
   And never underestimate the importance of differentiating yourself by truly understanding your customer. Customers place great value in vendors who put effort into "getting" their business.
   
   
2. We always know what key individuals in prospect firms think of our proposed solution
   
   WSOs are nearly twice as likely as other organisations (35% v. 18%) to know what key individuals in the prospect firms think of their proposed solutions.
   
   This is a striking result. Even though the gap is large, it should be concerning to all that only one-third of all Winning Sales Organisations have this specific knowledge of their proposals to customers. Prospective customers think of proposals in the context of their organisation's needs - what they are trying to accomplish, fix or avoid.
   
   And if a sales team doesn't understand or even know their prospect's opinion of a proposal, it seems even less likely that they understand the prospect's concept of success or even where their prospect is in the buying cycle.
   
   When salespeople use a systematic approach, the proposed solution will specifically address the customer's problem. The proposal will be aligned with the issues learned by questioning, probing, exploring and gaining knowledge about the customer.
   
   Bottom line: know the customer well. When you think about the customer, don't think about the organisation, but the individuals and each of their perspectives. Of course, finding out who the decision makers are (likely about a half dozen, but there may be up to 30) can be a daunting task. That's why it's always a good idea to find a coach inside the prospect company - someone who wants you to win. Then, use your coach to help you identify the key decision makers and their perspectives on what needs to be accomplished, fixed or avoided.
   
   
3. We consistently utilise comprehensive prospecting plans
   
   While 41 percent of WSOs say they consistently use comprehensive prospecting plans, only 21 percent of all other organisations say they do.
   
   There's a tendency to work on existing customers, not prospects. Even WSOs focus on the things right in front of them. Over the last five years some sales professionals have come to believe that prospecting is a job for marketing, not sales. It's hard to stick to structure and process, but you have to keep your funnel full at all times. And like it or not, that means prospecting.
   
   Part of the sales representative's aversion to planning comes from endless annual cycles of account or territory planning, which create reports that sit on shelves instead of being practical or actionable. For planning to take hold as a discipline, there must be a clear identification of WIIFM - What's in it for me? The sales rep receives the strongest WIIFM through two metrics: personal income growth and client success. Planning should be reinforced by management sales leaders who ensure that both the sales process and resources support individual and sales team success.
   
   Our research suggests that top-performing sales professionals actually describe their ideal customers in their prospect plans. Then they go out and search for prospects that match the ideal, enabling them to qualify more leads and close more deals.
   
   
   
   

   
   
   
   
   
4. We have an established procedure to know when to stop investment in large deals
   
   WSOs are much more likely to have a process for knowing when to stop investing in a large deal. According to our survey, only 15 percent of most organisations have such a process, compared to 29 percent of WSOs. It's understandable that even so few WSOs know when to walk away from a large deal. This is a huge blind spot for most sales managers.
   
   The dictum of 'No Request for Proposal (RFP) shall go unanswered' is not a good idea. All too often, by the time an RFP lands on your desk, it's already too late - and your proposal will only be used for comparison purposes. Proposals take time, energy and money. Don't invest in the ones where the customer doesn't fit the template. If you didn't spec it don't bid it.
   
   Sales reps are competitive. They don't want to give up. But you can't win every piece of business, and not every customer is ideal for you. Get a good understanding of what your ideal customer looks like by writing out four or five bullet points with both qualitative and quantitative criteria. Create more detailed criteria based around their decision-making process. This will help you understand whether or not you can win.
   
   We've found that WSOs know when to admit they're losing and that it's time to walk away.
   
   
5. We regularly benchmark our performance and productivity against external peer groups
   
   While 23 percent of WSOs report that they regularly benchmark themselves against outside organisations, only 12 percent of all other organisations do so - a significant gap! While sales organisations routinely measure progress related to internal production goals, it is not a complete analysis of performance. Measurements are relevant only when external benchmarking against peers is added.
   
   For example, in good market conditions, internal statistics may confirm meeting 150 percent of quota - a substantial gain - while competitors may be achieving 250 percent of quota. This casts an entirely different light on whether an organisation is over- or under-performing.
   
   Benchmarking against peer groups has been a common practice to drive improvement for nearly every other functional area. By establishing robust standards you can hope to  give sales leaders new opportunities to drive performance improvement.
   
   The critical path forward should be simple:
   
   • Choose a small number of key metrics to measure
     
     
   • Create an internal baseline on those metrics
     
     
   • Make a commitment to measure consistently over time without changing the definitions or metrics
     
     
   • Report on the metrics
     
     
   • Create improvement plans based on the results
     
     

Perception Gap #1 - Our leadership is actively engaged in our sales process

This is the number one area of disconnect, with 78 percent of executives yet only 49 percent of managers and 43 percent of sales representatives agreeing. An effective sales process always defines executive involvement with strategic accounts in clear and concise terms. Without such clarity, for example, a CEO who feels that his sales force always has access to him may believe he is "engaged in the sales process", but his sales force may not agree.

Develop an executive call plan for strategic accounts. Executives shouldn't go on every sales call, and they shouldn't only go when there's a problem. There are other ways a communication breakdown may lead to this perception gap. The C-suite may not always report which accounts they're personally attending to. Or, it might be a matter of definition: a CEO may feel that visiting the top account once a year means he's involved.

While 45 percent of C-level executives agree with this statement, less than a third of sales representatives (27%) and sales managers (30%) agree. Bringing sales and marketing together is critical. Sales is on the front line. They may not know the value marketing brings to the table. C-levels know that marketing is all about accelerating the sales cycle, but salespeople don't always see it. Since the executive level knows what sales and marketing are each doing, it should make sure each knows what the other is doing.

When sales and marketing are aligned there is accurate messaging and higher quality leads. Marketing is about positioning, about brand integrity and not necessarily about lead generation (as many salespeople believe). Sales is about getting results, about closing deals. While they share the same ultimate goal, their strategic plans will differ.

Align the two functions by having each create its own strategic plan, but having them create their plans together - with the big picture in mind.

In our survey, 31 percent of executives, 21 percent of managers and 19 percent of salespeople agreed with this statement. Why the gap? Most CRM systems are designed and created as a management tool. Reps feel CRM doesn't help with sales. Reps don't want to share information.

For the C-suite, be clear on what you expect from your CRM system. It provides intelligence, visibility; it can help make decisions. It won't close business, it will just count it. Sales representatives can make CRM work for them by using it to plan, track, follow up on sales calls and maintain customer information.

There are a lot of sales representatives who feel that the CRM system is there to monitor them. They see it as big brother. But they don't understand that for the C-suite, it's a way to gather and use information for making decisions.

This too goes back to the WIIFM principle. The WIIFM for the C-level is consistency, management control, discipline and fact-based decision making. These values are far less meaningful to the sales representative, compared to a CRM implementation focused on helping the sales representative close more business.

Perception Gap #4 - We are never blindsided by the loss of a significant deal

Only 20 percent of the C-level respondents agreed, while 32 percent of sales representatives and 24 percent of sales managers said they were never blindsided.

Sometimes when an executive asks a rep how a deal is going, the rep - afraid to deliver potentially bad news about a sale that is not going well - says, "fine, fine". When executives and managers get this response, they should probe a bit, and ask follow-up questions. Sales professionals who know their customers' decision-making process and match their solution to what the customer wants to accomplish, fix or avoid, don't often feel blindsided when they lose a deal.

It comes from not knowing where the customer is in their buying process, and it comes from focusing only on the selling process. It is so important to know the customer's business, their buying process, who the players are and what they're thinking about. When you're thorough, there will be fewer surprises.

In our survey, this question was met with low agreement across the board. C-level respondents saw the most value (16%), followed by sales managers (15%) and sales representatives (11%). We don't see this as an indictment of HR, but as a sign that HR may not have a thorough grasp of the complexities and nuances of the sales process. Most salespeople know that selling is different from other company functions, and that sales training has its own conventions, standards and subtleties.

HR should support sales process training, but it should be delivered by the sales department. Our experience suggests that a thorough understanding of the nature of the sales process, born of experience, is necessary in order to deliver sales training that resonates with salespeople and impacts their performance. We recommend that rather than providing direct sales training, HR should support the sales department's training program.

And C-level executives need to make sure that the sales leaders know they are responsible for developing their people - and that HR is there to support them.

HR should be tuned in to understand the sales leaders' issues in order to apply its expertise in providing solutions in the people space with what the sales leader is trying to accomplish with his team. A perennial and expensive sales team problem is the cost of turnover, and the resulting increase needed for each salesperson's quota in order to hit revenue targets. The sales leader may not be familiar with hiring and coaching strategies and tools.

When HR brings talent-related resources and expertise to the table to help the sales leader execute the true value of HR is realised in the sales space.

Miller Heiman's annual research study of sales practices, success metrics, and Winning Sales Organisations is recognised as the largest continuous research project dedicated to sales performance in the world. Sales leaders benefit from the resulting trends, insights, and best practices revealed by our research. Even more significantly, the research results support benchmarking exercises that enable companies to understand how they compare to their peers and how they can better identify areas for improvement.

Since the study was launched, more than 13,000 sales professionals have participated. Our formal research projects combined with our day-to-day business relationships with sales leaders and sales professionals enables us to continually validate and refine our thinking in the real world.

Miller Heiman's research focuses on complex, business-to-business sales which, for this study, we've defined as having sales cycles longer than one quarter and more than four decision makers influencing the outcome. Over 6,000 sales professionals participated in the current study, representing 19 industries including technology, healthcare, business services, telecommunications, finance and manufacturing.

Respondent companies are located in the U.S., Europe, Australia, Asia, South America, the Middle East and Africa.

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