Smarter sales management

There is a general perception that there are two types of people in the world – buyers and sellers. Sellers think that buyers are suckers. Buyers think that sellers are charlatans.


Sales management is one of the least understood areas of business and it does not help that generally people don’t like sales people. Usually sales forces are quite separate from the rest of the organisation and practice the voodoo of incentives, commissions, on target earnings and discussions under non-disclosure agreements.


So how can we get the most out of this area of business? To build smart sales organisations we may have to go back to basics to get the most out of convincing the market to buy our product.


Establishing a high velocity sales organisation


One of the approaches to sales is to build a high velocity sales organisation. While most organisations would love not to have sales people the modern combination of social media, effective marketing and management of sales processes is creating a new set of metrics for sales process. And it is not about calling people executives, consultants or directors to impress clients – it is about doing the work of selling.


Companies are revolutionising the sales process by effectively combining inbound marketing through search engines and other social media with good sales tools and effective follow-up strategies.


Step 1: Generate Leads


To get people to buy your product – you need to speak to them.


Some of the most effective ways to generate leads is still print advertising and direct calling. People still read and expect to find information of opportunities in print media. Increasingly online keyword buying, pay-per-click and keyword auctions drive the delivery of a message to a specific targeted audience with pre-set demographics. Another key source of leads is to working through follow-up on older leads. Cold calling and canvassing target organisations is still important. Websites generally do not sell products – they generate leads and people sell products.


Going through the hoops to find the person that you should be speaking to is a simple “old-school” and very effective way to present your message.


The key to choosing effective lead sources is to monitor the cost per click or cost per lead. This is done through tracking the phone calls, website hits and other types of enquiries that is received shortly after a campaign in a specific media source. To get 500 “warm leads” it is estimated that an online cost of about R250 – R 1000 per lead is fairly common and for print advertising it is usually slightly lower – although different products may have different experiences.


This then translates back into the outbound sales person’s cost per call as well. If a person costs you R 20,000 per month and attends 20 meetings with prospective clients – this is a lead cost of R 1,000 per client. If they are successful 10% of the time that means that those 2 meetings that was successful should yield at least R 9000 profit each, just to pay for their salary (R 20,000 salary – 2 x successful meetings = R 18,000 / 2 successful sales = R 9,000). That means that the unit sales price would have to be at least R 50,000 to R 60,000 for this to be meaningful (assuming a net profit margin of 15% to 18%). If you product is not worth that much, or your margins not as high – then outbound sales is simply not a profitable approach for your business. In this case you better stick to telesales in which you can go through more leads quicker and maybe have lower success rates but higher conversion rates.


Step 2: Properly qualify your sales lead.


James Obermayer in Managing Sales Leads argue that if you do not as a minimum know the source, contact details and interest of an individual that it cannot be counted as a lead. It follows in order to do this, that you need to have a slightly more than superficial interaction with the client. Qualifying the sales lead to know what the interest is may mean the difference between having a business card on your desk and doing the sale. Find out if the client has in your product and to know where you got that lead. Even on the web it is still necessary to collect lead information and properly segment the online market.


For complex sales it is important to build an account plan that outlines who the key stakeholders are including the decision makers, influencers and gatekeepers. Each of these will need a separate approach and there needs to be an agreement amongst the bid team how to approach the sale.


Step 3: Allocate leads


One of the strategies followed to allocate leads is simply a round-robin system where the next available person gets the next available lead and not to get stuck to territories or fixed allocations. If a sales person has not followed up in 2 hours – reallocate to the next sales person.


It is also usually a good idea to support a sales campaign with account managers who work on upsell opportunities and creating solutions, proposals and other sales tools for clients to support the sales effort. This allows the sales person to canvas the leads and spend their time selling – rather than writing proposals.


Lead allocation is a critical component of sales – because getting it wrong tends to mean that you start losing sales.


Step 4: Sales Tools


Clients always ask you to send them more information and it is important to have that information on hand. Having a good brochure, price list and other information to send to clients is the difference between being responsive and frustrating a client. You should be able to produce a quote in as little time as possible to really respond in a high velocity sales environment. Websites must also give the client the ability to buy the product without much cloak and dagger. You sell more when people have information and it is easier when that information is prepared before you start.


One of the most important sales tools is for sales people to understand what the real value of the product is to the end client. Let them see, understand, play with and experience the product and you will soon see sales increasing. It is always easier to sell something you believe in.


Step 5: The actual sale


After planning to sell and having all the tools together we need to recognise that a sale is a process. A well-defined sales model can be tracked through a pipeline methodology or a tool such as It usually assigns a value to the sale and shows the percentage completion per activity. An example of such a process is outlined here.


10%     – lead is qualified (interest, project has requirements, timing is <6 months) If a rep doesn’t act on a lead in two hours it is sent to another rep.

25%     – product identified, value estimated, pricing discussed, discovery process, demo scheduled

50%     – demo completed (meeting, pre-recorded, webinar or 1:1), requirement reviewed, decision maker identified

60%     – client-reviewing information, verified requirements

75%     – selected as vendor, pricing sent

90%     – awaiting signed paperwork, verbal commit

95%     – received paperwork, submitted to finance for review

100%   – received payment


Each organisation may have a slightly more or less complex sales process.


Step 5: Manage sales performance


High velocity sales organisations have a critical focus on recruiting suitable reps and managing out any non-top performers. For many sales organisations this process is seen as predictable and repeatable and it is a form of an endurance sport – one that you can succeed at if you follow the process and drive your leads forward.


Sabnis, Chatterjee, Grewal, Lilien (2013) show that as many as 70% of leads generated by marketing departments falls into what they call the sales black hole. Sales representatives do not pursue these black hole leads and this results from competing demands on sales reps’ time. The proportion of time that sales reps devote to actual work on leads depends on how well qualified those leads are and the voracity of the managerial tracking processes (extrinsic motivation), as well as marketing lead volume (opportunity), and sales rep experience and performance (ability).


Their research indicate that management processes need to focus on supporting high performing sales people to manage volume, while pushing less experienced sales reps to gain more experience faster so that less leads end up in the black hole.


Step 6: Improve your sales metrics


Most enterprise companies work on a quarterly/semi-annual/annual reporting cycle whereas high velocity sales companies are more of a daily/weekly/monthly metrics pace. This is a huge culture change for most sales organizations but one that can provide sustainable advantage. One habit of power sales companies is to update sales forecasts weekly.


To get there you need to understand your sales metrics.


On the most basic level it involves


  1. What is the average price of my product?
  2. What is the average length of time it takes to close this sale (days)?
  3. What is my costs over this period?
  4. What is my sales targets that need to be achieved to cover costs and achieve targeted profit?
  5. How many of these do we need to sell?
  6. How many new deals is that per month/week?
  7. How many deals is that per rep per month?
  8. Are we giving discounts and how does this influence the target?
  9. What is the conversion rate of a rep?
  10. What is the target per rep per month? Typical targets of between 5 x Salary to 50 x Salary (depending on the product) is not uncommon.
  11. What is the spend that I will put in as a cost per lead to get the leads to the rep?
  12. Does this include or exclude commissions and how does this influence the target?
  13. Where are all our deals in the sales process?
  14. What deals have we lost and why?
  15. What are we doing to fix areas where we have lost deals?
  16. What deals are simply in the leads black hole?
  17. How busy are reps really?


Once these metrics are designed – you must then start monitoring that this is what people are actually doing. Creating visibility of targets is very important and following up aggressively on non-achievement is the key to sustained sales performance.


In conclusion


A lot of people say that business is about whom you know and not what you know. Sales people know that it is about how many people you can speak to and having the tools and process behind you to deliver on your promises. Being in sales is not just about having “networks”. A person that claims to have networks that give them business is usually a person that has poor prospecting skills. Just because you can talk to people does not mean you can get them to give you business. A sales person cannot rely on past clients and friends to give them business. Sales is about getting out there and looking for new avenues to sell products. Sales people have to hit the streets to get new business. They also have to knock on the doors of people that work with you competitors to get your product noticed.


This article shows that sales management is a process that needs to be actively managed to achieve performance.






Sabnis, G, Chatterjee, S, Grewal, R, & Lilien, G 2013, ‘The Sales Lead Black Hole: On Sales Reps’ Follow-Up of Marketing Leads’, Journal Of Marketing, 77, 1, pp. 52-67, Business Source Elite, EBSCOhost, viewed 4 May 2013.