We begin with this basic premise: Sales cannot be managed. Sales are the OUTPUT of a process. By the time revenue and the associated margins are generated, everything critical to the function of selling has already been done. Lead generation, prospecting, qualifying, presentations, and negotiations have occurred well before a sale hits a company's books. This is undeniable truth. Unfortunately, this is also true: A sales organization’s performance is typically judged by the output of sales revenue and margins. Their level of performance, therefore, is determined by something that can't be managed.

At the root of the problem is an obsession with numbers. Look, I get it. Wall Street runs many of our organizations and their obsession with numbers is essential to determining our value to equity investors. Senior management makes performance commitments to Wall Street and equity shareholders, expectations are set, and our stock prices rise and fall on our performance relative to those commitments and expectations. Unfortunately, that obsession and those commitments, like other things, flow downhill, from executive leadership, to middle management and field sales management, ultimately landing on the desks of sales people.

As long as commitments are met, everyone (at least for the short term) is happy. What happens if you're short of the commitment? Well, it turns out that what flows downhill can also hit the fan. What is thrown off? Numbers, numbers, numbers. "We're not at objective, so...." What have you sold? How many prospects have you identified? How many new leads have you generated? How many new proposals have you submitted? What is their dollar value? What's in the pipeline?"

Don't get me wrong. I understand the value of knowing where you are relative to your targets. And it has to happen. The failure, though, is the attempt to MANAGE these numbers. Remember output? Sales, a proposal submitted or the generation of a lead are all OUTPUT of processes and therefore can't be managed. Get the picture?

In many cases where we have seen organizations experiencing a shortfall, we have heard management simply say "Come on guys, you need to go out and sell more" or "We need to get more in the pipeline", "You need to find more prospects", "You need to generate X number of new leads this week." Even a sales promotion is an attempt to produce more prospects, more proposals. When you manage by the numbers, the primary fix to a sales shortfall is demanding more activity, more NUMBERS! The result? In some cases, sales people will fill their SFA / CRM with activity that isn’t real just to keep you off their back. Or if they follow your instructions, you may be asking your sales force to engage in more activity they are already doing poorly. This increase may result in a short-term bump in sales, but the demand for more and more over time creates burnout and turnover. Sales promotion after sales promotion eventually promotes nothing more than skepticism from wary customers expecting the next “If you buy now” routine. Eventually the sales staff has nothing more to give and still can't meet the numbers. Then what? A new sales promotion? New sales people? New sales management? Sometimes things DO come in threes.

So over the next few eNewsletters, I'm going to help you break the obsession. You can't keep managing the same way and expect different results. There is a way to please Wall Street or your business owners while building high performance sales teams, serving very happy customers. I'll prove that it's not just about managing performance, but as importantly, managing development.

Ok, this is a bit of a cliffhanger, but I'm out of space for now. See you next month! In the meantime, if you want additional information, visit us at AXIOMsfd.com.