Why dysfunctional sales is at the heart of many dysfunctional businesses- and how to fix it
The Machine: A Radical Approach to the Design of the Sales Function by Justin Roff- Marsh is a book that my clients are all aware of- I talk about it often. Justin has also made multiple fantastic appearances on The Melting Pot (most recently HERE). The Machine is a plain-talking, radically opinionated approach to sales and marketing. When I first discovered the Machine, I realised that there was no point in me writing a book on selling- I didn’t need to because Justin had already done it. Justin and I are completely aligned on several elements of his approach to sales, and I believe his methodology will fix your sales problem and ultimately help your business grow faster.
You wouldn’t be reading this article, or interested in Justin’s work, if your sales team was functional in the way that you’d like it to be – the test for this is simple – if you double the number of salespeople in your organisation, would you double your revenue?
If you answered a definite yes, stop reading. Just go right now and do precisely that- hire twice as many salespeople and make twice as much money. But if you hesitated, you’re not sure, or you don’t think it will, your sales structure is inefficient –but don’t worry, you’re not alone. The doubling idea makes it obvious but, in fact, when I have this conversation with clients, what they often realise underneath it all is that they don’t believe adding an additional salesperson would drive the revenue up at all- because if it were that simple a problem, they would have already fixed it.
Inefficient sales structure
Many of the companies I know and work with are teach based, skippered by brilliant leaders, many of whom may not have come from a sales background. They follow ‘good’ known sales structures but often notice that these are not efficient enough to keep up with their growth. Your sales function should be about driving the organisation to the moon, but they often end up holding companies back. I’ve seen many CEOs hiring salespeople that don’t meet their targets, then keep firing those salespeople because they’re rubbish. I’ve known cases where companies have gone through five sales directors in as many years and they still haven’t solved the problem. Its often at this point (or hopefully before) that coaches like Justin or me get involved, as the CEO recognises a need to see the problem from a new perspective.
Attract the best salespeople
Justin’s approach addresses the widespread but often under-addressed issues – “current” sales structures do not encourage A-Player salespeople. If you go to market and hire ten random salespeople, you’re likely to get ten shit people; Harvard Business Review found in a 2016 article that only 15% of salespeople in the world achieve 120% of their targets. In no other part of the business would that spectacular under expectation be tolerated; if you hired that badly anywhere else in the business, the company would fall over.
One of the radical elements of Justin’s theory, that I agree with, is that you should stop paying salespeople commission. They are just as much a part of your team as everyone else. With commission, I’m bribing you to do something that you don’t think is in the best interest of you, the customer, or the company. This is not the approach to sales that salespeople should have. More than that, we need to approach ‘salespeople’ as an idea, differently; 80% of top-performing salespeople out there do not think money is their key motivation. They will be just as happy to be paid a decent salary. This also prevents internal conflict and promotes openness. In reality, everybody is going to be responsible for the sale; the technical guys, the product guys, the CEOs doing executive selling, lots of other people are involved and yet the sales guy turns up, and we pay them a premium. Not that you should not pay well for good sellers- I just don’t think you should do it on a variable basis.
You need to look for A-Players for your sales team just as you should any other are of the business: when interviewing a salesperson ask ‘what have you done in the last 30 days to make you better at selling’- they’ll probably look at you like your mental, whereas talking to somebody in marketing and there’ll likely be able to tell you a new marketing tool or technique. You should expect the same curiosity from your sales team; looking at a bell curve for talent you should go above and beyond to look for top talent and hire right. This will also help you create a dynamic aspirational environment for your team. Your sales structure should be about creating a system that is a fantastic place to work for people who might be two standard deviations from the mean; the best available talent for your company for your price range. How do we get a few of them into the business and accelerate its growth?
Don’t waste your company’s time
Ok, so we’ve decided we want to focus on getting the best possible people for the job, but the other key factor that Justin addresses is the need to let these star sellers sell. If you’ve managed to get the guy who’s the best in the world at sales calls, who can close any deal for you- you should be having him do just that all the time. I’ve implemented part of this with a sales team that had initially been spending 75% of the day doing things that were not directly selling. The structure of their work was not allowing them to be successful. If you feel your sales team has the potential to achieve more, start by taking away all of the other admin type tasks they are doing. Justin expects to get any sales team to grow their sales by 11X, but ask your self this as a start point, can you make sure your salespeople have time to have ten selling conversations each a day, is that not already at least 5x what they are currently doing?
The Machine also addresses the idea that sales can’t be fixed in isolation. To free up sales time, making sales more efficient, many businesses find they also have to address wider inefficiencies. Key to this are pre-sales organisation and customer service. Companies with more efficient sales have a significant focus on pre-sales. It is beyond powerful to make sure you target precisely the right audience and focus on lining them up to be happy customers. This is often a marketing problem and – just to clarify – the role of marketing is to drive selling conversations in sales.
A wider restructure
This reflects another point that Justin and I agree on – that marketing can often get lost in branding (in fact, I’ve encountered successful companies where the KPI for marketing is spending the budget, but this is a discussion for another time). Often, when re-addressing marketing, I find that companies may need far fewer leads than the CEO might have previously thought. With many companies, especially tech-based, often 10 to 20 new clients a year would be ‘all’ it takes to double a business in three years.
To this end, there is immeasurable importance in seriously focusing on target audience and value proposition. (You can read more about why it’s essential to find your niche here) Once you have a really specific target audience, your marketing team will need to focus on hundreds, not thousands of targets. You should be able to, on a quarterly basis, hit all of the people in your target universe with new value propositions. Rather than wider, broader marketing, make sure your marketing team create lots of ready-made opportunities for selling conversations.
The other fix you need to put in place before you can fix sales is customer service- alongside your marketing to get potential happy customers lined up. This would ideally involve using account-based marketing. Making changes to business functions may seem like a costly, extensive change, but it should be a net saving; moving firepower from your sales to the marketing and customer service teams, and making sure that you don’t have anyone in sales just filling a chair. Making the teams more efficient will allow you to massively increase your sales and ultimately scale faster.
You can learn more about team efficiency in my recent conversation with Andrew Holm and Julian Wilson, who have experimented with a range of business models through their experiences.
Also, if you think your sales team could benefit from a shakeup and would like the opportunity to learn more, you can meet Justin at the farm- check out our upcoming workshop here.