Seven Early Warning Signals of Ineffective Sales
Seven Early Warning Signals of Ineffective Sales
1. Can’t duplicate the model of successful sales people. This is typically a sign of not having an established sales process. A sales process describes the flow in which a customer goes through your sales cycle; such as what happens next and who hands off what to whom. It also includes selling skills and what is needed to perform each step in the process in the most effective way; from cold calling to closing. Early warning signals that you might be deficient in this area include:
• Some sales reps are very successful while others are struggling, yet they are selling the same products or services to the same type customers
• Sales reps are calling on non-decision makers
• You are spending time writing proposals for RFP’s from prospects that haven’t been properly qualified
• Forecasts are inaccurate and incomplete
• Quotas are your only sales plan (i.e., no territory or account management strategies are in place for each sales rep)
• Sales reps are confused as to what to do next to close a sale
To correct this problem, develop a sales process that reflects the best practices of your sales team. Provide sales training to help your sales reps improve upon their weaknesses. Train your people, and provide continual reinforcement, on the sales process and how it works. Make sure all departments in your company understand the process and potentially are part of it.
2. No Lead Flow. When marketing spends time and money acquiring new leads and your sales people don’t find those leads to be useful, you have a severe problem. Conversely, when your sales people close sales but your Marketing department doesn’t know what kind of leads were closed nor where they came from, then that is equally a problem. The first thing you need to do is understand who your customers are, why they buy from you, what they buy, when they buy, and other purchase-related information. You should also understand things about their business (location, size, revenue, SIC code, etc.) or about them as individuals (age, sex, interests, etc.). With this information, Marketing can then target similar businesses or individuals with their campaigns. These leads will, by definition, be qualified since they will match the profile of others who already purchased from you. Your next step is to track these leads. Know where they came from and find out if they ended up purchasing from you or not, and why. When you create a lead flow system, you not only track how the lead went from Marketing to Sales, but the disposition of that lead and how it flows back from Sales to Marketing. If it was successful (a sales was made), then Marketing knows to find more of those types of leads and to look for them from the same, or similar, source.
3. No cost justification or ROI from marketing programs. This is an extension of #2 above. If Marketing is asking for more money for a new campaign or to repeat an existing campaign, but are not able to tell you how much revenue was generated from the previous campaigns, then this is an early warning signal. Simply telling you how many leads were generated is virtually useless. Spending money on campaigns that are not researched properly or sent to prospects who don’t match your existing customer profiles can be an enormous waste of time and money. Marketing needs to track the lead flow to make sure they are acquiring qualified and quality leads. As a result, they will be able to measure the success of their campaigns and determine if there was a positive return-on-investment.
4. Lost customer data due to employee turnover. If one of your sales people leaves your company and takes his customer data with him, this is another early warning signal of ineffective sales. Two major effects of this are; one, you lose track of what’s been happening with prospects and customers and following up is impossible thus endangering your customer relationships, and two, the new replacement sales rep has to start from scratch finding out what’s already been done, what’s been promised, and what has to happen next, resulting in lost productivity and sales. There are two ways employees can take customer information with them when they leave. One is if that information is in their head. In other words, you don’t have a centralized CRM (Customer Relationship Management) system for everyone to enter their client information and update it with recent activities and status. If you don’t, shame on you, since you are allowing your sales people to virtually own this valuable data and not share it with others. As a result, when they leave your employ, they take this data with them. The other way for them to take this information when they leave is to actually steal it. I call this the five o’clock CD. One day at five o’clock, they copy all your customer data from your CRM system onto a CD, slip it in their pocket or purse, walk into your office and say, “I quit.” You promptly escort them out the door thinking you protected your valuable information, but it’s already too late. The remedy for this is to limit what your users can and cannot do in your CRM system. At a minimum, preventing them from copying or exporting any data is crucial to protecting your valuable customer information.
5. Over or Under product manufacturing due to inaccurate forecasts. Forecasting is hard enough, but when it is inaccurate or incomplete, then your problems worsen and this becomes another early warning signal. The result of inaccurate forecasts can be that you predict the wrong amount of upcoming business and thus produce too many or too few products to accommodate a false demand. When you have a sales process that clearly defines each step in the sales cycle, and when you have properly trained sales reps who have the selling skills to effectively move a prospect through your sales process, then the forecasting process becomes much more reliable. Sometimes a sales person will rate the probability of a sale as being very high because he had a very positive meeting with the prospect. In reality, however, this account may not even be qualified. This type of forecast is an emotional one since the rep based it on how he “felt” the deal was going instead of it being based on some analytical metrics, such as what step was accomplished. For instance, if the sales rep performed a product demo and that is defined as step three in your sales process, and step three is defined as having a 60% probability of closing, then this opportunity has a 60% probability of closing, by definition. By creating a sales process such as this, you have removed any emotional feelings the rep may have had about the deal and enforced an accurate measurement system based on actions and activities. This method will yield a much more accurate forecasting system for you and your business.
6. Poor customer service. If you lose customers for no apparent reason, or you have to handle an unnecessarily high amount of customer complaints, then this is an early warning signal that needs to be addressed. What often happens is that since there is a lack of cohesive information about the customer within your organization, the client is given inconsistent information, or people assume someone else took care of something that they should have, or there is no follow up. Your goal should be to have on-going contacts with your existing customers that are positive, not negative. These contacts can be through phone calls, emails, newsletters, in-person, or whatever. And, they should be prompted by your actions, not as a result of a customer complaint. By staying in touch with your existing customers, you will proactively reduce the number of problems. By using a CRM system that keeps track of everyone’s contacts with a customer, you will reduce confusion, embarrassment, and poor customer service. Obviously, you’ll also need a corporate culture that views excellent customer service as a high priority and an objective for your organization.
7. Unproductive sales people. If your sales people aren’t spending the majority of their time on selling activities, then you are suffering from another early warning signal of ineffective sales. Unfortunately, too many businesses throw up barriers for their sales people by making them do more than they should be doing. For instance, detailed status or activity reports can be a huge waste of time for sales people. By scheduling their activities in a CRM system that is shared with everyone on a network, you can generate an activity report without wasting precious selling time. Having sales people chase down orders or shipping problems or do contract negotiations can also be time stealers that take away from selling time. Provide sales people with resources for them to delegate these non-selling tasks to. Territory management is another area that can waste time. If their territory is too large to efficiently manage, consider dividing it up amongst several sales reps. If a sales rep is traveling all the time to visit accounts, perhaps he isn’t managing his travel plans properly. Make sure he is organizing his visits by geography so he isn’t driving to one side of town in the morning and then to the other side of town in the afternoon. Instead, schedule several calls in the same area of town in the same day. Also, by using technology many in-person sales visits can be easily replaced by using web-based meeting services such as WebEx, Microsoft Live Meeting, GoToMeeting, and other services which are a lot more affordable than travel expenses. Look at where your sales people spend their time in the course of any given week. Then find ways to off-load some of their work and make them more efficient. You could even consider training them on effective time management skills.
If you suffer from any of these early warning signals, I hope this information will get you on the right track toward improving them. Sales effectiveness is a priority that every company needs to address. Hopefully, yours already does.
Good luck and good selling!
Russ Lombardo
(702) 655-5652
Seven Early Warning Signals of Ineffective Sales - To learn more about this author, visit Russ Lombardo's Website.
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No one is perfect, and no business is either. So it stands to reason that individual components of a business may not be perfect either. Specifically, this could mean your sales department and sales processes could use some tuning as well. Consider these seven early warning signals and see if you can make some improvements in some areas of your business.
1. Can’t duplicate the model of successful sales people. This is typically a sign of not having an established sales process. A sales process describes the flow in which a customer goes through your sales cycle; such as what happens next and who hands off what to whom. It also includes selling skills and what is needed to perform each step in the process in the most effective way; from cold calling to closing. Early warning signals that you might be deficient in this area include:
• Some sales reps are very successful while others are struggling, yet they are selling the same products or services to the same type customers
• Sales reps are calling on non-decision makers
• You are spending time writing proposals for RFP’s from prospects that haven’t been properly qualified
• Forecasts are inaccurate and incomplete
• Quotas are your only sales plan (i.e., no territory or account management strategies are in place for each sales rep)
• Sales reps are confused as to what to do next to close a sale
To correct this problem, develop a sales process that reflects the best practices of your sales team. Provide sales training to help your sales reps improve upon their weaknesses. Train your people, and provide continual reinforcement, on the sales process and how it works. Make sure all departments in your company understand the process and potentially are part of it.
2. No Lead Flow. When marketing spends time and money acquiring new leads and your sales people don’t find those leads to be useful, you have a severe problem. Conversely, when your sales people close sales but your Marketing department doesn’t know what kind of leads were closed nor where they came from, then that is equally a problem. The first thing you need to do is understand who your customers are, why they buy from you, what they buy, when they buy, and other purchase-related information. You should also understand things about their business (location, size, revenue, SIC code, etc.) or about them as individuals (age, sex, interests, etc.). With this information, Marketing can then target similar businesses or individuals with their campaigns. These leads will, by definition, be qualified since they will match the profile of others who already purchased from you. Your next step is to track these leads. Know where they came from and find out if they ended up purchasing from you or not, and why. When you create a lead flow system, you not only track how the lead went from Marketing to Sales, but the disposition of that lead and how it flows back from Sales to Marketing. If it was successful (a sales was made), then Marketing knows to find more of those types of leads and to look for them from the same, or similar, source.
3. No cost justification or ROI from marketing programs. This is an extension of #2 above. If Marketing is asking for more money for a new campaign or to repeat an existing campaign, but are not able to tell you how much revenue was generated from the previous campaigns, then this is an early warning signal. Simply telling you how many leads were generated is virtually useless. Spending money on campaigns that are not researched properly or sent to prospects who don’t match your existing customer profiles can be an enormous waste of time and money. Marketing needs to track the lead flow to make sure they are acquiring qualified and quality leads. As a result, they will be able to measure the success of their campaigns and determine if there was a positive return-on-investment.
4. Lost customer data due to employee turnover. If one of your sales people leaves your company and takes his customer data with him, this is another early warning signal of ineffective sales. Two major effects of this are; one, you lose track of what’s been happening with prospects and customers and following up is impossible thus endangering your customer relationships, and two, the new replacement sales rep has to start from scratch finding out what’s already been done, what’s been promised, and what has to happen next, resulting in lost productivity and sales. There are two ways employees can take customer information with them when they leave. One is if that information is in their head. In other words, you don’t have a centralized CRM (Customer Relationship Management) system for everyone to enter their client information and update it with recent activities and status. If you don’t, shame on you, since you are allowing your sales people to virtually own this valuable data and not share it with others. As a result, when they leave your employ, they take this data with them. The other way for them to take this information when they leave is to actually steal it. I call this the five o’clock CD. One day at five o’clock, they copy all your customer data from your CRM system onto a CD, slip it in their pocket or purse, walk into your office and say, “I quit.” You promptly escort them out the door thinking you protected your valuable information, but it’s already too late. The remedy for this is to limit what your users can and cannot do in your CRM system. At a minimum, preventing them from copying or exporting any data is crucial to protecting your valuable customer information.
5. Over or Under product manufacturing due to inaccurate forecasts. Forecasting is hard enough, but when it is inaccurate or incomplete, then your problems worsen and this becomes another early warning signal. The result of inaccurate forecasts can be that you predict the wrong amount of upcoming business and thus produce too many or too few products to accommodate a false demand. When you have a sales process that clearly defines each step in the sales cycle, and when you have properly trained sales reps who have the selling skills to effectively move a prospect through your sales process, then the forecasting process becomes much more reliable. Sometimes a sales person will rate the probability of a sale as being very high because he had a very positive meeting with the prospect. In reality, however, this account may not even be qualified. This type of forecast is an emotional one since the rep based it on how he “felt” the deal was going instead of it being based on some analytical metrics, such as what step was accomplished. For instance, if the sales rep performed a product demo and that is defined as step three in your sales process, and step three is defined as having a 60% probability of closing, then this opportunity has a 60% probability of closing, by definition. By creating a sales process such as this, you have removed any emotional feelings the rep may have had about the deal and enforced an accurate measurement system based on actions and activities. This method will yield a much more accurate forecasting system for you and your business.
6. Poor customer service. If you lose customers for no apparent reason, or you have to handle an unnecessarily high amount of customer complaints, then this is an early warning signal that needs to be addressed. What often happens is that since there is a lack of cohesive information about the customer within your organization, the client is given inconsistent information, or people assume someone else took care of something that they should have, or there is no follow up. Your goal should be to have on-going contacts with your existing customers that are positive, not negative. These contacts can be through phone calls, emails, newsletters, in-person, or whatever. And, they should be prompted by your actions, not as a result of a customer complaint. By staying in touch with your existing customers, you will proactively reduce the number of problems. By using a CRM system that keeps track of everyone’s contacts with a customer, you will reduce confusion, embarrassment, and poor customer service. Obviously, you’ll also need a corporate culture that views excellent customer service as a high priority and an objective for your organization.
7. Unproductive sales people. If your sales people aren’t spending the majority of their time on selling activities, then you are suffering from another early warning signal of ineffective sales. Unfortunately, too many businesses throw up barriers for their sales people by making them do more than they should be doing. For instance, detailed status or activity reports can be a huge waste of time for sales people. By scheduling their activities in a CRM system that is shared with everyone on a network, you can generate an activity report without wasting precious selling time. Having sales people chase down orders or shipping problems or do contract negotiations can also be time stealers that take away from selling time. Provide sales people with resources for them to delegate these non-selling tasks to. Territory management is another area that can waste time. If their territory is too large to efficiently manage, consider dividing it up amongst several sales reps. If a sales rep is traveling all the time to visit accounts, perhaps he isn’t managing his travel plans properly. Make sure he is organizing his visits by geography so he isn’t driving to one side of town in the morning and then to the other side of town in the afternoon. Instead, schedule several calls in the same area of town in the same day. Also, by using technology many in-person sales visits can be easily replaced by using web-based meeting services such as WebEx, Microsoft Live Meeting, GoToMeeting, and other services which are a lot more affordable than travel expenses. Look at where your sales people spend their time in the course of any given week. Then find ways to off-load some of their work and make them more efficient. You could even consider training them on effective time management skills.
If you suffer from any of these early warning signals, I hope this information will get you on the right track toward improving them. Sales effectiveness is a priority that every company needs to address. Hopefully, yours already does.
Good luck and good selling!
Russ Lombardo
(702) 655-5652
Seven Early Warning Signals of Ineffective Sales - To learn more about this author, visit Russ Lombardo's Website.
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David AchesonDavid Acheson is the founder of DCJA Consultancy. DCJA Consultancy is a management consultancy business specialising in B2B sales consultancy. They offer bespoke and packaged sales consultancy including Sales Optimisation Review, Interim Sales Management, Sales & Marketing Review, 1:1 Sales & Management Staff Analysis, Management Training, Solution Sales Training, Creation of New Pay Plan, KPI's, run Customer Feedback Campaigns, assist with Recruitment, Coaching, Appraisals and set up Strategic Marketing Campaigns. David spent his early career in accountancy and then moved into sales in 1982, working in Office Equipment, IT, Advertising, Training, Outsourcing and Consultancy. He has held many Senior Positions in SMBs and Global Organisations including Head of Sales Operations & Head of Business Development. His knowledge, skills and great experience of the Sales Industry has led to David making keynote speeches and running educational sessions to key businesses through organisations including The Chamber of Commerce and Business Link. - Visit David Acheson's Website |
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Dave KurlanDave Kurlan is the founder and CEO of Objective Management Group, Inc., the industry leader in sales assessments and sales force evaluations, and the CEO of David Kurlan & Associates, Inc., a consulting firm specializing in sales force development. Dave has been a top rated speaker at Inc. Magazine's Conference on Growing the Company, the Sales & Marketing Management Conference and the Gazelles Sales & Marketing Summit. He has been featured on radio and TV, including World Business Review with General Norman Schwarzkopf, in Inc. Magazine, Selling Power Magazine, Sales & Marketing Management Magazine and Incentive Magazine. He is the author of Mindless Selling and Baseline Selling – How to Become a Sales Superstar by Using What You Already Know about the Game of Baseball. He created and wrote STAR, a proprietary recruiting process for hiring great salespeople, and he writes Understanding the Sales Force, a popular business Blog and is a contributing author to The Death of 20th Century Selling and 101 Great Ways to Improve Your Life, Volume 2. - Visit Dave Kurlan's Website |
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Leanne Hoagland-SmithAre your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website |
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Linda RichardsonLinda Richardson is the Founder and Executive Chairwoman of Richardson, a global sales training and performance improvement company. As a recognized leader in the industry, she has won the coveted Stevie Award for Lifetime Achievement in Sales Excellence and she was identified by Training Industry, Inc. as one of the “Top 20 Most Influential Training Professionals.” Ms. Richardson is credited with the movement to Consultative Selling and is the author of ten books on selling and sales management, including Sales Coaching — Making the Great Leap from Sales Manager to Sales Coach, and Stop Telling, Start Selling. She teaches sales and management at the Wharton Graduate School of the University of Pennsylvania and the Wharton Executive Development Center. Linda is a frequent speaker at industry and client conferences, has been published extensively in industry and training journals, and has been featured in numerous publications, including The Wall Street Journal, Forbes, Nation’s Business, Selling Power, Success, and The Conference Board Magazine. Learn more about Richardson's sales training and performance improvement solutions at http://www.richardson.com web - Visit Linda Richardson's Website |
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John BrennanJohn Brennan Ed.D. Dr. Brennan is President of Interpersonal Development, LLC, a training and development firm. Interpersonal Development has provided sales training and coaching to more than 3,000 sales reps from over 100 companies. A native of Australia, Dr. Brennan received his doctorate from the University of Rochester. His dissertation researched the effectiveness of Behavioral Modeling Technology in training people in interpersonal skills. While he has spent most of his career designing or delivering training, he was also a Vice-President of Sales of a training and development franchise with operations in 25 markets. Dr. Brennan has designed and delivered sales training in North America, Asia, Europe, Australia and the Middle East. He has been a guest speaker at numerous national and regional professional conferences. When Microsoft wanted Best Practices articles on sales for their web site, they called Dr. Brennan. The results are at http://office.microsoft.com/en-us/FX011387391033.aspx His firm’s clients have included Volvo, The Prudential, Merrill Lynch, Eastman Kodak, Gannett, Equifax Europe, the Economist Group and countless small businesses. - Visit John Brennan's Website |
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George LudwigGeorge Ludwig is a recognized authority on sales strategy and peak performance psychology. An international speaker, trainer, and corporate consultant, he helps clients like Johnson & Johnson, Abbott Laboratories, Northwestern Mutual, CIGNA, and numerous others improve sales force effectiveness and performance. Though it's George's strategies and processes that help corporations increase productivity and performance, it's his tremendous energy and dynamism that spark the transformation. Again and again, clients remark on his amazing ability to unleash human capacity and inspire men and women to break out of their comfort zones. The result is a whole new type of salesperson. His customized presentations teach achievers to make stunning advances in their lives. From helping salespeople realize cherished dreams to helping corporations exponentially accelerate revenue streams, George Ludwig leaves audiences and individuals empowered, emboldened, and clamoring for more. George is the best-selling author of Power Selling: Seven Strategies for Cracking the Sales Code and Wise Moves: 60 Quick Tips to Improve Your Position in Life & Business. - Visit George Ludwig's Website |
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Stephanie RobeyStephanie Robey is President and CoFounder of Pivot Positive, LLC - an Internet marketing business focused on helping people start work at home ventures. Previously, she was employed at The Search Agency with over 20 years experience in graphic design and 10 years experience in online marketing. She was responsible for launching the Conversion Path Optimization (CPO) unit where she and her team have conducted hundreds of optimization tests for online companies across multiple verticals. She is a successful entrepreneur having started and sold 2 companies and remains on the board of directors of the third, PhotoSpin.com Stephanie began her career in the direct marketing realm creating and producing direct mail for many of the major cable television companies and directly attributes her understanding of Internet marketing to those early offline experiences. Stephanie is a graduate of San Diego State University with a BFA in Graphic Arts and also holds an Executive MBA from the Graziadio School of Business and Management at Pepperdine University. Read Steph's Blog Meet Steph and Dave Sign up for our Free 7-Day BootCamp: Self Employed & Rich - Visit Stephanie Robey's Website |
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Anne BarrAnne Barr has over 26 years experience in sales and marketing, six years as a franchisee. She has assisted over 367 business owners and purchasers to achieve their goals in career change, transition and exit strategy. She holds the designation of Certified Franchise Executive from the International Franchise Association, Certified Business Intermediary from the International Business Brokers Association and Board Certified Broker from the Texas Association of Business Brokers. Anne is active in professional organizations, networking groups and volunteers for non-profit entities. As owner/operator of four successful businesses, Anne has proven people skills and enjoys helping clients find the right "fit" in business ownership. Visit www.FranchiseOpportunitySpecialist.com for more information about me and my company. - Visit Anne Barr's Website |
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