Rethinking The Sales Organization
In the “old days” the structure of the sales organization was pretty simple. Hire a bunch of people, give them territories with goals and turn them loose to sell. There were variations of that theme, sometimes we used indirect sales organizations, like manufacturer’s reps, resellers, channel partners, and others to sell for us. Sometimes all the selling was done over the phone. Sometimes the territory was geographically defined, sometimes it was industry/segment defined, sometimes it was defined by accounts.
But the model was pretty simple. A sales person had a territory and was responsible for selling all the company’s products and services into the territory.
Likewise, our customers were probably a little simpler then. Fewer people were involved in the decision making process, they had few alternatives to consider. There probably weren’t as many of them. So the model worked–kind of.
I’m constantly amazed by the number of organizations that still use that basic model. A sales person, assigned to a territory, responsible for all the products and services, doing everything from prospecting, deal management, product/solution/segment expert.
Our own businesses and the breadth of our solutions is often so great, varied, and complex that a single person cannot be expected to be expert at more than a few.
Our customers organizations, the problems they face have become so complex, that one individual can’t possibly have the expertise, or even the bandwidth to cover everyone we need to engage, across each customer, across the territories.
The customer buying process/our selling process are becoming so complex, that a single person can seldom master all the competencies needed to prospect and find customers, qualify, facilitate the buying process, grow and expand our relationships.
The old models of the sales person being all things to the customer is no longer sufficient for many organizations.
Specialization has become increasingly important. It’s actually been around for some time.
We’ve had organizations organized by product line—each going after the customer separately. Sometimes, competing with each other for customer attention and spending. We, also, have introduced the concept of “overlays,” sales specialists working collaboratively with account managers.
The process of how we engage customers have changed. We used to be face to face, increasingly our engagement strategies no longer need face to face contact, leveraging phones, web conferencing and other approaches.
We segment the sales/buying process, SDR’s, BDR’s and others cover much of the front end, passing customer opportunities to others–account managers, sales specialists.
And with all of this, much has moved to eCommerce. Customers order products from the web, not needing much sales engagement.
Changes in technology, changes in how our customers buy, the demand to provide coverage for all potential customers have driven huge changes in the way we deploy sales organizations.
Underlying this, sales executives are driven by “cost of selling.” We have to achieve our revenue growth and other market objectives, but we have to do this in a way that’s affordable–so we have to be concerned about the cost of selling.
The problem is, too often, as we reassess our deployment strategies, we optimize them for our own organization and our target cost of selling.
The customer becomes an afterthought. We design a sales deployment strategy optimized to our objectives, yet may not take into account the customer and how they want to be engaged.
But customers are good at solving that problem–they find the suppliers that engage them the way the prefer. But it may not include us.
How we engage our customers, how we deploy our resources to work with customers, doing that in affordable manner is a constant challenge.
The perspective we take in designing the organization is important. Are we designing it based on what suits our objectives? Are we starting with the customer and how they want to buy?
We can always meet our cost of selling goals with either approach. Bu the outcomes produced can be very different.
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