Author: Dr. Scott Downey, Director and Professor
I have written before about how management is a well-researched process that involves analysis, planning, execution and measurement. I have also pointed out how my discussions with sales managers often result in fairly dismal responses of basic measurement of the sales process (i.e. not knowing how much a sales call costs or being able to compare a good salesperson in a difficult territory with a bad salesperson in an easy territory). There are many reasons for sales managers not understanding the role: true sales management, as distinct from supervision or account management, still remains relatively new in our industry; operations management remains an important activity in many ag sales organizations; the context of selling as a marketing function is only now being defined; and, finally, the consolidation at the farm gate and among retailers has occurred very quickly.
I thought it might be worthwhile to share a checklist of some best practices for sales managers.
Connecting to Marketing Strategy
In many agribusinesses, marketing strategy has either been focused on products or advertising. While both are important marketing components, the integration of these components with pricing, distribution, non-product value creation and other promotional tools has been limited, in my observation. Although all of these topics receive some attention, their integration and how they connect to customer segments is often lacking, which makes it hard for sales managers to know how to manage effectively.
To connect successfully with marketing strategy, sales managers must have a clear understanding of:
- The prioritization and unique marketing mix approaches geared toward each targeted segment.
- How value is created beyond products and what future innovations are required for each targeted segment.
- How their organization’s value differs from that of its competitors in the minds of customers in each targeted segment.
- The sales coverage, organizational structure and skills needed to coordinate promotion and value delivery uniquely for each segment of targeted customers.
- How to coordinate sales as an activity that serves segments at the company level and individual customers at the field level.
Managing Territories
In agriculture, coordinating sales activities in the field generally means coordinating specific geographies. The analysis, planning, execution and monitoring of these activities within each geography usually means sales managers compare performance against goals and past seasons. However, it’s also important to frequently update the analysis of potential in the marketplace by acre/head and incorporate competitive pressures along with decisions made regarding how to connect to the organization’s marketing strategy.
Effective territory management should include:
- Understanding individual market potential by segment and acre/head within the territory, including cross-sell potential.
- Understanding competitor marketing strategy (market coverage and penetration, value, pricing, messaging and positioning with target segments).
- Aligning resources with value and service decisions at the marketing level in order to accomplish goals for obtaining potential in the face of competition.
Achieving Sales Targets Through People
When I ask managers what exactly they manage, their first response is usually people. When we discuss what gets measured, analyzed, planned and executed, the list is often pretty short … revenue. This isn’t a negative; the whole point of a sales effort is revenue, and there’s nothing and no one to manage if there isn’t any revenue. The real problem with this being the only or primary subject of management is that it is VERY simplistic. Revenue generation — a sale — is the conclusion of a process. Often (and hopefully), it’s a recurring outcome within a relationship.
Achieving sales targets means that managers are responsible for what this process looks like and how it is implemented by salespeople, with each salesperson bringing their own unique strengths to the process. In the old days, it was thought that a salesperson’s ability was innate. Sales managers were promoted from the ranks of successful salespeople, and then they “coached” their people to do what they had done to be successful earlier in their careers. Today, we know that successful sales leadership is different than supervision and coaching. The job of a sales manager is to know what activities lead to sales and service strategies with targeted segments. Then, they must help salespeople to use their own strengths to reach goals, not turn them into Mini-Me.
Sales managers must be proficient at:
- Objectively assessing the strengths and abilities of individual sellers.
- Defining what sales tasks are required in order to accomplish value objectives with targeted segments and identifying quality metrics for those tasks.
- This step includes: prioritizing opportunities, targeting and differentiating service and coverage across segments or relationships, identifying the sales call mix (using the right type of sales call at the right time), and managing the pipeline.
- Creating a culture of self-improvement in which salespeople measure and analyze their own performance rather than doing things because the boss is watching.
- Analyzing and removing barriers to revenue generation relating to market factors and personal development of sellers.
Effective sales management is difficult when few managers in agribusiness have the luxury of solely focusing on this role. Often, sales managers are technical leads, maintain large accounts and manage pricing, inventory and procurement in addition to managing people and processes designed to generate revenue.
Accomplishing this checklist requires managers to be humble and listen actively, to use more leadership than supervision and to empower and provide ongoing attention to issues discussed in training. Managers must pay attention to salespeople almost as if they were customers themselves, because the job today takes a great deal more thinking, measurement, analysis and planning in addition to execution.
Learn more from Dr. Scott Downey in the Sales Management and Leadership program! You’ll have the opportunity to assess your people development skills and gain tools for becoming a more effective coach for your team. Through group discussions and activities, you’ll also practice handling situations such as retaining good salespeople and using assets your team already possesses to their greatest potential.
