Having been part of many sales teams throughout my career, I’ve noticed five common challenges with the power to dampen morale and reduce sales performance.
Found to some degree in almost every organisation, savvy management teams are aware of these challenges and work to avoid their potentially destructive impact.
Here are five sales mistakes guaranteed to make your business less money.
Challenge 1: Wasting sales representatives’ time
Asking your sales team to spend time on non-sales tasks — accounts receivable collections, managing product recalls, or filling out reports that don’t directly relate to the sales process – has the potential to derail their money-making efforts for your business.
If, for instance, you divert 5% of a sales team’s time to managing customer collections, you effectively reduce the number of feet on the ground by the same amount.
Sometimes it’s necessary to assign non-sales tasks to salespeople, but before doing so it’s worthwhile auditing your company’s sales process to determine whether they could be absorbed elsewhere.
Finding as many ways as possible to remove unnecessary tasks from the sales team’s shoulders will result in sales increases that more than pay for the reassignment of duties.
Challenge 2: Poor sales meetings
Boring sales meetings are the bane of your workforce’s existence. Any salesperson worth his/her salt will be thinking: “Is this meeting making me money?”
Powerful salespeople are self-motivated; they know if their time is being wasted. Wasted time is yet another morale-killer as it shows management don’t appreciate what it takes to increase sales. Why should a salesperson have confidence in that type of leadership?
The best way to ensure effective sales meetings is to develop a ‘statement of strategic intent’ that includes clear success metrics. It takes a deep knowledge of the business, the market, and the competition to write an effective statement. Managers who can’t write them need to do their homework stat.
The bottom line is that powerful meetings produce sales and keep morale high.
Challenge 3: Poor strategy
Ineffective marketing or sales strategies will always negatively affect the sales team. This is especially true for teams selling commodity products or services.
Fact: a player with small market share who enters a commodity market without a well-defined and well-implemented strategy will fail. These companies usually say, “It’s a huge market, and we can grab some of it,” but it’s not that simple.
The sales team that recognises ineffective strategy quickly loses faith in the managers who developed it. If players on a sports team lose faith in the coaching, the path to winning is difficult, if not impossible. The same is true with sales teams. Don’t let lacklustre or nonexistent strategy hobble your company.
To compound the error, companies often try special promotions to save sagging sales on products that are ill-conceived or supported by poor strategy. Special promotions can be very effective, but sending the sales team on a promotion in support of a poor product or service is a severe tactical error. A successful sales effort hinges on good strategy, and companies that fail in this regard severely handicap their sales teams.
Challenge 4: Capping or reducing income
Powerful companies have managers who aren’t envious when large pay cheques go to the sales force.
Managers who are resentful often respond to rising sales income by reducing commissions, capping earnings, reducing territories, or removing products. These are all practices to be avoided, as they destroy morale, which hurts sales.
When it’s absolutely necessary to cap or reduce reps’ earnings, it must be done carefully. If it’s done carelessly, management will send the message that future earnings for the sales team have been limited.
Powerful salespeople want to leverage today’s efforts into greater sales and income for tomorrow. High performers will quickly look for employment elsewhere if they’re punished for delivering the goods.
Challenge 5: Favouritism
Playing favourites with individuals on a sales team is destructive. Salespeople want to work for companies that operate a level playing field. If select salespeople are given extra incentives, special attention, benefits, or favours not afforded others, management is sending a clear message that there’s a privileged class within the team.
This is one of the most effective ways to lessen team spirit. Reps will spend their time trying to move into that special class, not closing sales. Managers can’t buy the loyalty of a team by strengthening a small political powerbase within a company. Keeping the playing field level will pay big dividends.
Wasting time, poor sales meetings, poor strategy, capping income, and playing favourites are, with few exceptions, situations to be avoided. They’re destructive to morale and they lead to poor performance.
Effective managers will avoid these situations, and astute salespeople will bring these practices to the attention of management for correction.
John R. Treace has over 30 years experience as a sales executive in the medical products industry. He spent over 10 years specialising in the restructuring of sales departments of companies that were either bankrupt or failing. Investor groups and venture capital firms hired him to manage turnarounds of pre-IPO companies. In 2010, he founded JR Treace & Associates, a sales management consulting business. He is a member of the National Speakers Association. Treace is the author of the new book, Nuts & Bolts of Sales Management: How to Build a High-Velocity Sales Organization.