Here, we look at three ways sales organisations can find their 40 percent through a reinvestment in human capital.
Make Long-term Sales Productivity Investments
Researchers at PwC examined what drives productivity in US businesses. They learned that “planning for productivity means doing long-range planning, not indulging in short-term thinking.” This finding came from interviews with leadership at the executive level. This view is shared by sales professionals in the field. Our research shows that successful selling organizations choose long-term sales training programmes.
The tendency to favor short-term solutions is understandable for three reasons. First, research from McKinsey shows that 65 percent of leaders feel pressured to deliver short-term results. Second, long-term solutions often appear unfavorable because the “payoff” cannot be expected any time soon. As a result, leaders will need more patience to verify outcomes. Third, leaders are often uncertain about how an investment based on today’s data will pay off in the ever-changing future.
However, the same research found that fundamentals are stronger at firms with a long-term focus. These firms generate cumulative revenue growth that is 47 percent higher than other firms. Those with a long-term focus also experience less volatility.
Ensure That Productivity Includes a Focus on People, Not Just Tech
Selling organisations often embrace technological advancements. Digital tools offer more ways for sales professionals to source leads. The problem: the technology rarely helps sales professionals when they get in front of those leads. This outcome is like a flight around the world that never lands.
Additionally, more technology means more administrative responsibilities. As digital tools pile up, sales professionals are burdened with learning about the features, not the customer. As one leader summarised, “The technology changes rapidly, but the [workers] find their places around that technology more slowly.”
It’s not surprising to learn that for many sales professionals, time spent selling has dropped to just 36 percent of their workweek.
In fact, the problem is so pervasive that it has extended to the manager’s role. Additional research from Bain shows that “managers have fewer than seven hours per week of uninterrupted time to do deep versus shallow work. They spend the rest of their time attending meetings, sending e-communications, or working in time increments of less than 20 minutes.”
Technology has an important role to play in sales productivity. However, over-investment in technology and under-investment in people delivers a message that the power to sell resides in the tech, not the talent. This message reduces morale. It also erodes the sales professional’s locus of control — their sense of agency and belief that outcomes are within their control.
Focus on Meeting the Full Range of Customer Needs
Businesses sometimes pursue productivity by prioritising quantity over quality. In a selling organisation, this problem is represented by winning more deals that are too small.
This outcome is a problem because chasing many small wins exhausts efforts. Doing so also ignores valuable cross-selling opportunities within existing relationships. Moreover, jumping from sale to sale drives the two above problems. Leaders make investments suited to short-term performance, and they resort to the digital tools to increase the volume of leads. Success comes from capitalising on front-loaded efforts by accessing the customer’s white space in an expanded sale.
Investments designed to drive output without regard for quality leave true sales productivity lacking. The reason: the output increases but so do inputs. This strategy leads to a lot of peddling and few miles gained.
The Way Forward
Productivity is a key economic problem of the 21st century. For many sales organisations, the solution is within the workforce. By investing in the right thing — improved selling behaviours — leaders can achieve more with existing resources.
As McKinsey found in their review of successful businesses, “Just under half the fast growers spend significant time and money on sales-force training, compared to 29 percent of slow growers.” Focus investments on the long term, people, and value over volume.