Do you budget for sales management training?
You spend thousands of dollars training each sales rep each year, but research shows that 84% of sales training content is lost after 90 days. (I cringed, too).
While training traditionally goes to salespeople, new research reveals that we need training for what Vantage Point Performance Partner Jason Jordan calls the toughest job in the sales force: sales management.
Jason shared new sales management data and insights in a recent webcast: $3.5 … The Cost of a Bad Sales Manager. Here are 14 statistics that might make you rethink your training budget.
14 Statistics CFOs Need to Know About Sales Management
Data from Ohio University’s Dr. Adam Rapp shows the breakdown of a sales manager’s day:
- 32% of a sales manager’s time is spent on managing people.
- 26% of a sales manager’s time is spent on managing information.
- 23% of a sales manager’s time is spent on customer interaction.
- 15% of a sales manager’s time is spent on administrative tasks.
- 4% of a sales manager’s time is spent on control (eating lunch, etc.).
The next set of data came from research by Vantage Point Performance Partner Michelle Vazzana. She worked with a group of global B2B sales forces, including 515 sales managers and 4,691 salespeople.
- The bottom 25% of sales managers were performing at 76% of their target.
- The middle 50% of sales managers were performing at 99% of their target.
- The top 25% of sales managers were performing at 115% of their target.
Top-performing sales managers achieve 39% more of their target than bottom-performing managers. While you might expect that kind of range in performance for salespeople, Jason says, this dispersion for sales managers was unprecedented.
“A good [high-performing] sales manager is substantially outperforming a poor-performing sales manager,” Jason says.
That same study also looked at the percentage of reps achieving quota:
- The bottom 25% of sales managers had 47% of reps achieving quota.
- The middle 50% of sales managers had 48% of reps achieving quota.
- The top 25% of sales managers had 65% of reps achieving quota.
While the middle-performing sales managers were at 99% of their target, only 48% of their reps were hitting quota.
“This proves something that we anecdotally know: A lot of sales managers can get to their quota not because [all of] their reps are knocking it out of the park, but because they have one or two or three reps that are knocking it out of the park…or perhaps they’re making it up with their own sales,” Jason says.
The top 25% of sales managers drive more consistent performance in their sales teams. This is a better measure of sales manager performance than overall quota attainment because these managers help all of their reps perform better.
Other research from Vantage Point and the Sales Management Association looked into the sales management training practices of 213 companies with 25,800 sales managers. More than half of the companies surveyed invest less that a quarter of their training budget to sales managers, despite data that shows it’s correlation to overall team performance:
- Companies who allocate less than 25% of overall sales training budget toward management training perform at or around their goal.
- Companies who allocate 25-50% of overall sales training budget toward management training outperform their goal by 6%.
- Companies who allocate more than 50% of overall sales training budget toward management training outperform their goal by 15%.
These statistics are illuminating. Yes, you do still need to focus on training your salespeople. But if you want to make a real impact on your bottom line, start with sales managers.
BONUS: The cost of a bad sales manager is $3.5 million … watch the whole webcast to find out how.