Finding the Weak Links

The job of sales has never been tougher as customers become increasingly sophisticated and demanding and the line separating products, services, and “solutions” blurs. How is sales doing in this complicated environment? And how could it do better? To find out, we conducted the Forum Sales Effectiveness Study, in which we interviewed 111 senior sales executives in 96 major corporations across 17 industries around the world. All the companies had strong sales organizations. Forty-two of them were listed as “most admired” by Fortune magazine, and five were ranked among the top 15 sales forces by Selling Power magazine. We asked the executives to rate their sales forces’ performance on a variety of metrics, including revenue, profitability, account development, and retention. We then asked them to rate their sales organization and describe in detail its management capability, the quality of its processes and systems, the sales force’s skill, and the organizational culture. The picture wasn’t pretty. In general, the executives were underwhelmed by their sales forces’ performance, even though their teams were reputedly among the world’s best. On a ten-point scale, the executives gave their sales forces an average grade of 7, or about a C-minus. Roughly a third of sales executives rated their forces below 7, about a third ranked them between 7 and 7.9, roughly a quarter rated them between 8 and 8.9, and only a tenth gave their sales forces the equivalent of an A (9 or higher). This finding is consistent with other studies that show executives’ lack of confidence in sales. (A 2004 Accenture survey, for example, found that out of 178 executives polled, 56% saw their sales force’s performance as “average, worse than normal, or ‘catastrophic.’ ”) What made the difference for higher-performing sales forces? With the possible exception of their superior ability to find new customers, there was no single capability that gave high performers the edge. Rather, it was the sales functions’ superior capabilities across the full spectrum of management, process, and skills that accounted for their achievement. Assessing Sales’ Performance You can use the following capabilities assessment survey to compare your perceptions of your sales force’s performance with those of your managers, salespeople, and customers; to identify significant performance gaps; to help set priorities for improving sales performance; and to gauge the overall effectiveness of your sales force relative to the 96 sales organizations we surveyed. Few sales organizations gave themselves high marks on this survey. However, the tool can help even the best organizations improve by pointing to specific gaps in sales effectiveness. Look for patterns in your ratings. Note that weaknesses in one area may compromise strengths in another or undermine performance in general. To improve their sales organizations, executives need to ensure that all components of the sales apparatus are high functioning and mutually reinforcing. Fixing one area while others lag won’t help much. Pouring resources into finding new leads, for example, has little value if the organization can’t hold on to them. Having managers who are good at motivating the staff won’t pay off if they’re poor at formulating strategy. The executives we interviewed found that the diagnostic tools used in the exhibit “Assessing Sales’ Performance” helped them identify areas in need of attention. You will, too.

Finding the Weak Links

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