I am sharing this article with you because I believe that Chuck has it right.  There is a great deal of leverage in how and where you spend you the limited coaching and development time as a sales leader.  Each type of sales person below requires a different time and intensity commitment in your coaching.  I am not sure if the four buckets that Chuck chose are the right four, but I think that his analysis of the importance of analyzing the players on your teams is on-target.

Author: Chuck Mache

Have you ever closely examined why some people are wildly successful at selling, meeting and exceeding every goal placed in front of them, while others lack either the self motivation or certain key skill sets to get them to their next level of growth and performance? After all, they all have the same product, the same tools, and the same compensation structure. They’ve all been through the same sales management-training program. In my experience of 25 years selling, building sales organizations and leading and managing thousands of salespeople, the answer has to do with the fact that virtually all sales’ organizations are comprised of four different kinds of salespeople:

1. The Performers – The Top Producers

These high achieving sales executives are the best at bringing in the numbers, but chances are that you spend a fair share of your time cleaning up her messes. Seems like they’re either sky-high or down in the dumps. When the performer is down, they are out of their selling zone, and productivity comes to a standstill. But when the performer is up, look out world!

2. The Professional – Another Top Producer

This top producer is very consistent, a total team player, even tempered, patient, and consistently bringing in the numbers. Professionals are also part of the elite members on the sales team, but they seem to be missing some opportunities that would catapult them to super stardom if they made some slight changes to their selling game. Instead, they stick to self-proven conservative approaches.

3. The Caretaker – Stuck In A Major Comfort

These are the sales executives that are simply stuck in their lackluster comfort zones—giving you a solid month about every third month, or giving you about seventy percent of what they have all the time. They have the potential, but they’re consistently mediocre. You just can’t get them to perform the difficult tasks that it takes to produce at top levels with any regularity. Worse yet, they’re passive aggressive. You say to yourself, “If I could only wake them up, they’d be right up there with the best.”

I was giving a speech on “Four People, Four Paths” to a leading company in the California real estate industry where I was emphasizing the importance of knowing exactly who you are. While I was quoting my book The Four Kinds of Sales People and explaining in detail the struggles and breakthrough opportunities for each of the four kinds of sales people, a woman in the audience yelled out, “Oh my God, I’m a Caretaker!” The crowd laughed and I congratulated her on her honesty and pointed out to her (and others who were not so forthright) the tremendous opportunity that existed if she made the conscious decision to change and begin doing the difficult things that it takes to produce top results on a consistent basis.

4. The Searcher – The One That Belongs In Any Career But Sales

All sales leaders have made some bad hiring decisions that result in sales reps that just don’t belong in sales. They perceived a sales career to be easy and they were wrong. Producing top sales is hard work. These misfits are consumed with fear, and if truth be told, they honestly hate sales. They have no real intention of making the necessary changes to be successful. You’re better off helping them find more fulfilling careers.

My point is that while the individual make-up of sales forces may vary, there are always only four kinds. Management’s goal is to get the best to keep getting better while building a team with as many top producers as possible. That means management must influence those that are “stuck” in their comfort zone to break through to the next level. That means management must perform the unenviable task of helping those that don’t belong to find other career paths. In my experience, management gets too preoccupied with these two challenges and neglects the opportunity to get their top producers to reach for their next level of achievement. They have more potential. That’s why they’re the best. And can be even better.

If you want sales to improve, particularly in highly competitive sales environments, then leaders must create a growth-oriented atmosphere that thrives on constant improvement, regardless of market conditions. By the way, that means leaders and managers must also be striving to break through to their next level as well. Sales is about creating and sustaining momentum, and then creating even more of it. Consistently.

Article Source: http://www.articlesbase.com/sales-articles/sales-force-management-leadership-increase-profitability-by-understanding-your-sales-team-46023.html

About the Author:

Breakthrough mentor and sales guru, Chuck Mache, President of Chuck Mache Communications (http://www.ChuckMache.com) has more than 25 years experience in selling, managing, building and leading sales organizations regionally as well as internationally. In his Brian Tracy endorsed book “The Four Kinds of Sales People” Mache uses his transforming knowledge and expertise in building heavy-hitter sales organizations to deliver an inspired parable that identifies exactly how and why sales people excel – or don’t. Get his book today at http://www.thefourkindsofsalespeople.com/PR/ and increase your organization’s productivity, and profitability.

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One issue that makes this complex is that you will find experts, such as myself, on two very different extremes with a long continuum in between.   Uncommon Sense says that no product knowledge on the part of the sales person is necessary as long as the company has expertise.  More in the middle, Sandler believes that the sales person should have lots of product knowledge but use it sparingly.  On the other extreme would be systems like Natural Selling that believe product know is “essential.”

A second issue is that context matters.  In other words, to answer the “how much” question in your organization, you should consider factors like your lead generation vehicle (does it educate the prospect to the point that they are an expert?), your strategy, your approach, availability of people with the product knowledge in your market, your organization’s ability to train the product knowledge, and at least three more that come to mind.

Third, you will find that MANY sales people really like/need to be experts. For some, it will tend to cover part of the selling anxiety they have (I know sales people aren’t supposed to have selling anxiety, but let’s be real here). For others, it simply assists their confidence or the “conversation they have in their head” about themselves and their chosen profession.  Another group takes pride in knowing something the customer doesn’t, and it just flat feels great to dispense it.  Finally, there is the group that likes to have the knowledge that really helps people.   (A quick caution about this group, if you are in a business where “consulting” is part of the service, this group can tend to give it away. )

Look.  Regardless of the why, product knowledge is an expectation of many professional sales people and of many organizations.  However, it will take some thought to determine “how much” is right for you.

Finally, I would point out that different sales leaders define product knowledge differently.   Often you will see product knowledge defined as an understanding of a company’s offering and their company’s policies and procedures relevant to selling.  A simple example would be when the sales person knows that the product could solve a particular problem for a customer, comes in three configurations – one that requires installation and two that don’t – and can be delivered in three weeks.

For tangible goods, this often looks like product specifications.  For non-tangibles, this is more about understanding the potential applications, customizations that are possible, and the impact on pricing.  For hybrid sales that are for both goods and services, you can see how this can get infinitely more complex.

And one last point on the definition.   Some sales leaders regard industry or customer-specific knowledge as product knowledge.  At least from a training standpoint, it gets lumped in that bucket.

In part two of this post, we will examine all the areas where not having a clear answer to this question will, without doubt, cause inefficiency.

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This post will give you some additional thoughts about things you can measure in your sales organization that can shed some light on where the sales train is going off the track.

Numbers

1. # of phone outbound calls
2. # of contacts to appointments or full presentations
3. # of referrals generated
4. # of new prospects added to database
5. # of existing customer who placed follow-up orders in a fixed time period
6. # of sales of a particular product

Time

1. Time from lead generation to qualification
2. Time from qualifying conversation to proposal
3. Time from proposal to order
4. Time from qualification to order

Dollars

1. Avg transaction value
2. Avg spend per customer per year
3. Avg gross/net margin
4. Avg size of first order compared to fourth order

I am not at all suggesting this list is complete, just wanted to give you some things think about.  Also, I am not suggesting that every manager should be looking at all of these metrics.  I think that most organziations with a good list of 5 metrics accurately measured and reported (broken down by team and individual)  is solid for most organizations.

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For the purposes of this post, I am focusing on the element involved in determining the Customer Acquisition Cost (CAC).

There are four large buckets to examine:

1 Lead generation/advertising – Costs here can be quite hefty. They include all marketing efforts used to build your brand that compels your customer to finally fill out a web form or respond to some other type of direct response medium. Some of these items show up in a different part of the budget, but should not be ignored.
2 Follow up / qualifying – There is often a good deal of sales time spent here. These costs may be captured in the salary and commissions bucket. This is sometimes managed by third party resources. These costs should be identified and included here.
3 Proposal preparation / demonstration – These costs are all over the map in varying industries. They also can range a great deal depending on the complexity of the product. Take a hard look to include every cost that may be included here.
4 Salary and commissions – These costs should be straight forward. Be sure to include any spiffs or referral fees as well.

Good analysis of your CAC will assist you greatly in fishing in the right ponds. An accurate evaluation of the customer valuation will make clear that every potential customer is not worth pursuing. Conversely, some of your customers may be very profitable and worth additional allocation of time, resources, and manpower.

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