Why does the sales manager position at some companies appear to be a revolving door? It seems like there’s always a new name on the door. Perhaps you’re a CEO who is wondering if you should keep your highly qualified sales manager because the numbers just aren’t there, and you’re not confident that they will be. Or maybe you are that sales manager, and right now you’re wondering if you should be updating your resume because the CEO is always on your back. The problem is usually based on a lack of communication, and the solution is very straightforward.
When a company has a manufacturing problem, the line gets shut down until the problem is identified and it’s fixed. The same tactic should be applied to sales. CEOs and sales managers should be sitting down regularly to talk about what’s working and what’s not.
If that’s not happening in your company, it may be time to worry because poor alignment and lack of transparency between these two functions can derail your sales efforts.
Here’s how this situation typically plays out:
CEO: “We’re well into 2013. Our sales aren’t where they should be, and I’m getting nervous. Our sales manager says I should relax, that the pipeline is building and things will be fine. But I have trouble trusting that optimism. All I can see is that we’re not hitting our numbers even though our sales team is always busy. We can’t afford to wait while we gamble on getting one major account.”
Sales Manager: “I give the CEO a monthly report, but he doesn’t read it. He’s just focused on the numbers. Management just needs to be patient. The pipeline is building. They don’t like hearing bad news, but I’ve got the situation covered. The pipeline is just starting to convert and when it does, it will all be great.”
What’s really going on? This is not about the sales manager’s ability to sell or to manage a team. Instead, to paraphrase a famous movie quote, “What we have here is a failure to communicate.”
The CEO may only want to hear results, and may not want to play a role in the sales process. He’s hired an experienced sales manager who should be able to figure out how to make things happen without his help. The sales manager may tell him about things he is doing to improve revenue, but the CEO wants results now.
Meanwhile, the sales manager might be hesitant to deliver bad news. Perhaps he feels the CEO does not want to hear about another month of lackluster numbers, or he doesn’t feel supported for being honest. Plus, whenever he tries to tell the CEO to be patient because your efforts now take time to convert to sales, the CEO doesn’t want to hear it. He might also be afraid to admit that he needs help finding a solution.
Whether intentionally or subconsciously, the sales manager may start to embellish the situation so that it sounds more optimistic. “If this happens … and this happens … then we’ll be okay.” But in an effort to appease and reassure the CEO, the sales manager is not giving good information … which only frustrates the CEO.
If this continues, a lack of trust can tear down the relationship between the CEO and sales manager. It starts to get personal. The CEO may begin to wonder if he has the right sales manager in place. He worries that as the year progresses, something will need to change or there won’t be enough time in the sales cycle to salvage the numbers.
The CEO and sales manager need to start having honest, objective discussions. Together they should devise a plan to move the sales needle in the right direction. If you’re currently facing this situation, here’s how to fix it.
- Sit down and have a non-judgmental talk about the facts. Listen to each other and get everything on the table without trying to fix the problem. Use real data to determine what’s working, what’s not and why.
- Go through the options. What can you do about it? Invite others into the discussion if warranted. Rank each option based on impact and effort. An easy solution may be to have the sales team call on more customers. A harder solution may be to launch a new product. It might have a bigger impact but it’s not happening right away. So start by looking for the ones that are higher in impact and lower in effort.
- Create an action plan. Outline your goals, initiatives and activities. A goal might be to increase sales by $500,000. The initiatives help you get there, so one initiative might be to upgrade a percentage of current customers to newer versions of your product. Activities are actions taken by the sales team to support each initiative. The most important part of this step is that you both agree on what you are going to do, and the timeline for which things will be accomplished.
- Decide how you will communicate progress against the agreed-upon action plan. This is the biggest “miss” that we see between CEOs and sales managers. Will you get together once a week? What numbers will you track? Will there be a report? CEOs tend to get much more comfortable if they see progress against a plan rather than stories of what will come. Agree on your plan and review progress regularly.
Each year, we help many companies resolve this and similar communications issues. While the solution may seem like common sense, sometimes it takes an experienced and unbiased third party to get the process started. Give us a call if you’d like our help.