Managing And Motivating Entrepreneurial Sales People
Question: I’m frustrated. My salesforce just doesn’t seem to be motivated. They agree with me at sales meetings, but then don’t follow through. Any ideas?
Answer: I just had a phone conversation with a client who had a similar story to tell. He had built his business on the model of an entrepreneurial salesforce. He gave them a territory, paid them straight commission, and told them they were in business for themselves, free to develop the customers they chose with the products they wanted.
And for a couple of decades the strategy worked well. The business grew and expanded. More entrepreneurial salespeople were added, and the model was duplicated over and over again. So far so good.
But then the growth in sales began to slow down. Three flat or declining years in a row has caused this company president to question the status quo. Not only is business flat, but he’s unable to get his salesforce to promote the lines he wants to promote, he’s unable to get them to use new technology, and he’s unable to get them to prospect for new customers. Now he’s faced with an experienced salesforce, who for the most part, have become unmanageable.
The culprit? A sales model that was built on the concept of the entrepreneurial salesperson. There was a time when this model was effective, but in today’s competitive economy, there are serious difficulties with the entrepreneurial sales model.
This model works best when the market is growing. As long as there is more and more business out there to be had, the focus of most companies is to grab as much as they can, without caring a whole lot about which customers and which products make up the business. Employing a group of entrepreneurial salespeople reduces the demands on sales management so that the company’s executives can focus on building the infrastructure necessary to keep up with the consistent growth.
As we all know, this was the case for companies of the previous decade. By shifting the responsibility for sales management onto the salespeople, however, you give up much of your managerial influence. In effect, you cede management of the salesforce to the salespeople. And they generally make decisions that are in their own self interest, not yours. The very concept of an entrepreneurial salesperson is that he or she will manage themselves.
Is it any wonder that you can’t direct the salesforce?
As long as business was consistently growing, this wasn’t an issue. But now it is a concern. Many distributors have come to the conclusion that they have to initiate significant changes in their sales organizations if they are going to be profitable and grow.
Instead of just “more business,” progressive distributors want to expand the business by targeting accounts, emphasizing key product lines and acquiring new accounts using a variety of sales modalities. In other words, they want to direct the salesforce more precisely by focusing them on the behaviors that further the company’s strategic objectives.
Unfortunately, they are faced with a group of experienced salespeople who have become satisfied and content.
These salespeople would rather not move out of their comfort zones of established customers and established products. They have no desire to do the hard work of prospecting for new accounts. And many are content with the diminished incomes of the past few years.
The culprit in this conundrum is the entrepreneurial sales model. This is not to say that there are no entrepreneurial salespeople. Certainly a percentage of salespeople will be highly motivated, constantly improving, driven to succeed and willing to accept your direction. But,the chances of your entire group fitting this mold are slight. The issue is not the occasional exception to the rule; the issue is the model that no longer supports your strategic interests.
So, what do you do? The solution is going to require strenuous work.
The best bet is to wipe the slate clean and start over. Begin with the definition of what you would like the salespeople to do.
Once you have a clear and specific idea, then start dealing with implications of that. For example, does you compensation plan support the behavior you want? If not, then change it.
Does your training and development program equip the salespeople with the skills that support your vision? If not, it’s time to revise it.
Does your infrastructure support your idea of what the salespeople should be doing? In other words, does customer service, purchasing, delivery, operations, sales management, etc., all support the revised job description? If not, make some refinements.
Finally, do you have the kind of people who will wholeheartedly embrace your new vision? If not, then it’s time to begin the process of recruiting new salespeople.
Each of these questions is a difficult and challenging issue that speaks to the heart of how you have your salesforce structured. Designing and implementing these changes can take the better part of a year or two. Each of these initiatives will be met with resistance from some. It won’t be easy. Before you rush into the fray, however, make sure you count the cost. You may decide that you are not up for the task and that it is easier to continue to cede management to your salespeople.
Should you decide to revise your salesforce, you can anticipate arriving at a focused and directable staff — an enormously powerful asset for any company.
Dave Kahle is a leading authority on distributor sales. He’s authored 10 books, presented in 47 states and 10 countries, and has trained tens of thousands of salespeople and sales leaders. He can be reached at email@example.com, or 800-331-1287. Visit www.davekahle.com for more information or sign up for his free weekly Ezine.
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