Poor sales management can cost your company millions.
That’s why it’s imperative to identify bad sales managers and course-correct their behavior. But what exactly makes a “bad” sales manager?
The obvious answer is to look at quota achievement. However, research shows the average sales manager’s team hits 99 percent of their target, but only has 48 percent of reps achieving quota. According to Vantage Point Performance partner Jason Jordan, this proves something we anecdotally know – A lot of sales managers hit quota because they rely on one or two all-star reps, or make up the sales themselves (as opposed to coaching their whole team to quota).
We can’t assess a sales manager’s performance based on quota. So what can we do? Varsity Tutors director of sales Josh Schwartz was recently describing his process for onboarding sales management to me when he said something very insightful: Make sure the job functions of your sales managers are clearly defined. For Josh, those functions include hiring the right team members, coaching them to mastery, and being accountable for their performance.
This made sense. Those three activities create focus and alignment around a manager’s most important role: helping the sales team hit quota. But what about teams who consistently hit quota? Does it really matter if a manager doesn’t do those things? Absolutely. Research tells us that the No. 1 reason employees leave jobs is a poor manager. If you want to keep your top performers (and majority of your sales team), ask yourself these questions to assess your frontline managers.
3 questions to determine whether you have bad sales management
1. Are they hiring the right people?
Hiring the wrong sales reps can also cost your company a lot of money. If the manager hires a rep who doesn’t perform well, that rep will likely leave or be let go. If the manager hires a rep who doesn’t fit in with the company culture, that rep will probably have a similar fate. Consider how this disrupts your targeted annual revenue. Not only will you lose a quota-carrying person for the amount of time it takes for a replacement, but it could take up to 9 months for the new replacement to be fully ramped and making quota.
Speaking of replacing reps, some studies show that for highly paid jobs (such as sales), the cost of turnover can be as much as 213 percent an employee’s annual salary. For a sales rep making $100,000 a year, that equals a $213,000 cost.
How to fix it: Examine the interview process. Does your manager ask the right questions? To find out, use a tool like Hirevue to record a few interviews. Just like your managers review the call recordings of their reps, you should inspect the interview recordings of your managers. Then bring your sales management team together. Discuss what’s currently being asked in candidate interviews. As a group, you can agree on what qualities your team is looking for in candidates, and what kinds of questions managers should use to identify those qualities.
2. Is their sales coaching improving performance?
Effective coaching from sales management increases performance. But how do you know if your manager is coaching effectively? Do you know if he is coaching at all? Hold your managers accountable. Vantage Point’s Jason Jordan recommends measuring this from the rep perspective: Every week, ask each rep whether they received effective coaching from their manager or not. This prevents a skewed view of coaching from managers, who may consider “coaching” to be as simple as briefly talking to reps once or twice a week. Training toward mastery is a powerful intrinsic motivator for anyone doing creative or heuristic work. Without that, reps will feel less motivated to be successful.
How to fix it: Use weekly one-on-one meetings with you manager to review his coaching plans with reps. Help him use data to identify who, what and when to coach. Then follow-up with him in your next few one-on-ones to review how their coaching is impacting sales performance. Sales coaching software helps track coaching meetings, performance and action items for reps and managers. Your manager should also get on the same page with his reps to understand what’s working, what’s not working and where reps need help (in addition to understanding their personal and professional goals).
3. Are managers holding themselves and their team accountable?
As with any team, a sales manager’s main priority is to ensure the success of her employees. That means implementing processes and metrics that help guide reps from lead to close. Has your sales managers defined key selling activities for their team? Has she aligned her team around company goals and metrics? Does she provide personalized performance scorecards for reps to track their own progress to goal? If the answer to any of these is “No,” then your manager needs to focus more on the success of her reps.
How to fix it: Help the manager develop a sales playbook for the team. This should include the sales activities managers expect reps to perform and the metrics they set around those behaviors. Then let your manager develop a system for monitoring metrics and course-correcting performance. Some managers prefer sales scorecards, while others prefer a sales management system that automatically tracks activities, calculates pace to goal and alerts reps and managers when performance falls behind.
The point of this assessment and corrective actions is simply to help managers. Don’t read this article and then rush off to punish your sales managers. Use this as an opportunity to help them grow, which benefits your entire organization.