Sales Performance Blog

How to Fund Your Sales Transformation: Fire the Underperformers

As sales leaders, we spend a lot of timegood-bad-sign.png trying to develop the bottom 20% and turn them into capable salespeople. We send them off to two-day sales training seminars, have them take expensive sales assessment tests to confirm our suspicions, offer them self-help books, schedule countless one-on-ones, join them on sales calls and devote hours to documenting their performance.

On the other end of the spectrum are the top performers – the top 10%. Those that require little management of their daily routine and that consistently perform year-to-year.  The only coaching they need is to make sure they’re getting expense reports submitted in a timely fashion or have taken the annual employee survey. They are at the top of their game and have a track history of staying there. The management philosophy is to keep them rewarded and to stay out of their way.

So what's left? The 70% of your team that know they can get better at selling and are prepared to do the things necessary to achieve that goal. This is very fertile ground for a sales improvement/transformation program that can provide a way to get these “OK” performers closer to the optimal behaviors exhibited by your stars. But how to fund the transformation?

Let’s imagine you have a team of 10 sales people, each with a $5M annual quota – 2 low performers, 7 okay performers, and 1 star.  You decide to recapture the fully burdened cost of the low performers at $150K each by giving them the opportunity to realize their potential with another company.  That’s $300K that now can be invested in moving “the middle” to dramatically increase their performance vs. spending that money to find and secure 2 more “stars” to replace those bottom performers – which as bets go, is quite a risky.

Success in this endeavor comes down to two primary factors:

  • Your company allows you a level of empowerment with respect to headcount – essentially allowing you a dollar budget as it relates to your department’s personnel, and enabling you to “monetize” open positions and placing no restrictions on how you choose to invest the surplus.
  • Identifying those on your team have the skills (competencies) necessary to succeed in the job and the will (desire/determination) to want to get better at their chosen profession and display the behaviors and level of commitment to put into motion.

One of my colleagues was called in by a client of ours to facilitate a session that could help their sales leaders determine who on their teams had both the skill and the will necessary to get better at selling.  Using a simple and efficient matrix, largely credited to Max Landsberg from his 2003 book entitled The Tao of Coaching, the sales managers were able to get a clearer picture of where individuals on their sales teams fell on the continuum. 

Once plotted, the resulting matrix helped the managers decide which individuals needed to be addressed, how each of them should be addressed (additional direction, guidance, delegation or motivation), and what actions  were ultimately needed (fire, train, promote or inspire).

Now, back to the math…..

So, let's say that from a team of 10, you conclude that 2 either don’t have the skill or the will or both (and the numbers they’ve posted YTD are a testament to that reality).  This enables you to use their fully burdened cost (roughly $300K) to fund the sales transformation and quickly redistribute their accounts & quota across the remaining 8 team members. 

I'd love to hear your thoughts on this - how have you approached funding for critical sales training initiatives? Does my math seem right?

Tags: Sales Leader, Sales Training, Sales Transformation

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