Saturday, July 23, 2011

Building Your Sales Dream Team

John Treace, a business turnaround specialist and author, has spent 14 years saving companies on the verge of bankruptcy by restructuring their sales departments.

In his book “Nuts & Bolts of Sales Management: How to Build a High Velocity Sales Organization, Treace offers insights on how business owners can build effective sales teams and avoid common pitfalls. BNET spoke with him to learn more about the philosophy behind a successful sales team.

BNET: What’s the most important factor an organization should consider when creating a sales team?

Treace: Creating the right corporate culture is the cornerstone of any sales organization.

At the outset, companies should write an official list of core values that employees are expected to know and uphold. Not all values are created equal, however. For example, “Do the right thing for customers, employees, and shareholders,” is too broad. “Do the right thing for customers, employees, and shareholders and never take a position that favors one over the other” is a much better core value because it expresses explicitly how the value should be observed and limits how employees and management can interpret it.

BNET: What’s the most common mistake business owners make when putting together a sales team?

Treace: It’s tempting to give sales teams territories that are larger than they can realistically cover. It means more customers and potentially more commissions for the sales people. But in the long run, it’s a bad idea for both the sales team and company.

I made this mistake at a company I owned. It turned out the team could only handle 10% of the territory I gave them. I had to cut 90% of their territory, and since they were working on commission, this made them angry, to say the least. Once you lose employees’ trust, it’s hard to win back.

It’s better to keep a sales team’s territory to a manageable size and supplement their commissions with a salary increase than to give them more territory than they can handle and risk having to take it away.

BNET: When and why should you fire a high-performing sales rep?

Treace: If the highest performer on the team has a bad attitude, isn’t a team player, or fails to uphold company values or support management decisions, you’d better fire him or her. You know the type: He or she sits at the back table during a meeting on teambuilding and takes shots at management for wasting everyone’s time.

A bad attitude can poison a whole sales force. Even worse, keeping the bad apple on the sales force only on account of individual performance sends the signal to the rest of the sales team that all management cares about is numbers. This can stir up resentment and be bad for company morale and overall performance. Having a good team is better than having one high-performing employee.

BNET:  Any last words of advice or warning for sales managers?

Treace: Never throw money at a problem. Management teams at companies I’ve helped turn around blame their failures on small budgets. That’s the kind of attitude that got them into trouble in the first place. It’s all about the structure of the business and quality of the sales team.

Thanks to Harper Willis / BNet / CBS Interactive




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