Top Story - Total Selling Systems

Warren Wechsler's
Top Story

The Art of Sales Management

Warren Wechsler, bestselling author and national sales and motivational speaker, provides many valuable resources free of charge to sales trainers and sales managers. Some restrictions apply to the use and distribution of this information. For more valuable materials, visit Warren's web site www.totalselling.com. All materials and content © Warren Wechsler, 2001 – All rights reserved.

I am a salesperson, I'm a business owner, and I am my own sales manager. Whether someone manages you or whether you manage yourself, the things I'm going to talk about today are really the essence of what it takes to be an effective sales manager.

You might be asking yourself, "Why do you even need a sales manager? Why don't you just be unmanaged?" Well, the fact is there are two very important concepts in sales. One is what gets measured gets done. And the other thing is called what get rewarded gets done. Whether you are being managed or led or coached or mentored by another person, or if you're doing it on your own, it's very important – it's critical – to have some type of reward system so you know when you're doing a good a job. You give yourself rewards. And you need some type of measurement system so that you know whether you are on the track or off the track. It's very easy in sales to get distracted, especially when it comes to building our business, making those calls to our current customers, looking for new business, looking for referral business, looking for add-on sales. It's very easy to fall into a rut and just take the business that's handed to us by our loyal customers, and not ask two very important questions.

By the way, this is an emerging theme in my business in the last number of weeks, maybe the last three or four weeks, two key questions that you can ask as a salesperson. One is "what else?" You talk to your customer base and you say, "What else can I do for you?" The second is called "who else?" "Who else should I be talking to?" Just those two simple questions will lead you to much, much business.

Back to today's topic…Today's topic is sales management. In my view there are three main concepts that we need to be aware of in the business of sales management. They are called ARA. It's what I call the theory of ARA. The A, R, and A stand for Authority, Responsibility, and Accountability.

When I work with sales managers, they come to me and they say, "What should I be focused on? What should I be doing?" The answer is really simple. It is to focus on those three words. And there are three questions that go along with those three words.

Let's look at the first word, Authority. Authority simply means that someone is in charge. The question that goes along with authority is a simple question: Who's in charge. If you're a salesperson, you want to know who is in charge. If you're in a group of 5 or 8 or 10 or 50 or 100 salespeople, and you think that there's no one in charge, then you're going to rush into that vacuum and it's going to be anarchy. Think about 100 salespeople trying to determine the direction of where their company ought to be going, and how the territories ought to be divided, and how the compensation models ought to be put together, and how referrals ought to be shared, and how leads ought to be generated, and how support mechanisms are put in place. Can you imagine? It would be like that Super Bowl commercial from January of 2000. It was one of the accounting firms and they showed cats running wild across the range, and then showed cowboys trying to herd cats. That's the way it would be if nobody had figured out that first question and how to answer it, meaning who is in charge. If you're going to be an effective sales manager, the answer is that you are in charge. If there are territory disputes that come up, you have to be in charge. If there are commission things that come up, you have to be in charge. If there are salespeople that need to be measured, you have to be in charge. Sales management is like being Harry Truman. The buck stops here. And that's what the A is all about, the Authority word.

The second concept in the theory of ARA is the R word, and that's called Responsibility. Salespeople want to know what are the rules. What am I responsible for? That's what salespeople want to know. And our job if we're sales managers is to tell them. And again if you're not involved with a sales manager on a formal basis, then it's up to you to create this in your own business. You have to be your own sales manager. What are the rules? By that I mean what are the expectations. There's another saying in sales that's what gets expected has to be inspected. That's what I mean by what are the rules.

Think about it. From a sales perspective what could some of the rules be? Some of the rules might be how many sales are supposed to be generated each period, in other words, sales or new accounts or orders per month. Or it could be gross margin percentage, or new accounts opened or new products sold to current accounts, or new products sold to new accounts. It could be appointments set, referrals asked for, referrals attained, presentations made. These are all examples of setting rules. You could also have rules about what you expect of the salespeople in terms of performance within the organization: what type of hours they're going to work, whom they're going to interact with, how they're going to relate to customer service, how they're going to relate to manufacturing, engineering, support mechanisms, how they're going to have their expense reports submitted.

I have a client based in Minneapolis who came to me and said, "I can never get my salespeople to turn in their expense reports." I said, "If they don't turn in their reports won't they not get paid?" He said, "They're always late. They get paid but they're always late in getting them. And I need those call reports and expense reports so I know where they are and whom they're talking to." I said, "You have to make a rule about it." He said, "What do you mean?" I said, "Here's what you do. You create some type of sales contest. It could salesperson of the month or sales person of the year. And in addition to the performance-oriented things, how many new accounts, how many sales, what percent growth, you say to them that if they don't submit their expense and call reports on time, and they miss two weeks per quarter, then they're not eligible for the sales contest." What do you think happened when my client put that plan in place? How many salespeople do you think missed more than two weeks of sales reports and expense reports in the first quarter? Try zero.

What I'm getting at is the responsibility aspect. What are the rules? You need to make sure that you as sales manager set the rules.

The second A, the third concept within the theory of ARA, is called Accountability. That simply means that as sales manager, we ask the question that proves that the rules are enforced. The third question therefore is called "will the rules be enforced?" This is the most important of all three concepts, the first concept being Authority (who's in charge?), the second concept being Responsibility (what are the rules?), and the third concept being Accountability (will the rules be enforced?).

If my client in Minneapolis put together this elaborate, dynamic sales contest, and then said to people, "If you miss submitting your expense and call reports on time two weeks out of the quarter, you're not eligible for the contest", and then people violated the rule and he still let them enter the contest, what do you think would happen to all the expense and call reports? They would go south. They would not be turned in.

If you're asking salespeople to make X number of calls, or make Y number of appointments, or ask for Z number of referrals, and you establish that as the rules, and they know you're in charge, but you don't take the time to follow up, to inspect what you expect, to measure what you've put in place, then you don't understand the art of sales management. The art of sales management is simply holding people accountable. And you know what? Salespeople want to be held accountable. They don't want to spin out of control. They don't want to be going down the wrong path. They want to know that someone is going to hold them accountable.

One of the areas of my business, a business practice that I've been doing for years involves having one-on-one discussions with salespeople and sales managers simply to talk to them about how to manage this ARA function. I have phone relationships with people. They know I'm in charge. They know I'm going to follow up. They know I'm going to set rules. They know I'm going to enforce the rules. I just started working with three new clients in Florida today setting those ground rules. "What are you trying to accomplish? How are we going to measure it? What are you going to do between now and the next time we speak?" One guy said, "You're going to become my conscience?" I said, "You know what? That's right."

There's one other concept I want to talk about in terms of sales management. I'm a big fan of having weekly contact with sales folks. If you manage 200 salespeople it's not practical, but if you manage 20 or 30 you can still do it whether it's through email or phone-to-phone or face-to-face contact. And when we have these meetings, it's really important to ask four questions. The first question is "what did you sell?" Between the last time we talked and today, what have you sold? The reason we ask that question is that we want to give them a lot of credit for doing the right things, we want to give them a lot of strokes, and compliment them on the sales they've made. What if the answer is "nothing"? What if they haven't sold anything in the last week? You find out what's in the pipeline and where it's going, and if that goes on week after week after week after week and no sales are coming in, then you know you have a salesperson who can't ask for the order, and that gives you a coaching opportunity.

The next question you ask is "what's new?" If the answer is "nothing", then you know you have a salesperson that has call reluctance and they need to be out there making more new calls. The measure of the health of a salesperson's business is how many times they can say, "This is new; that's new; this is new; that's new." New calls, new business, new referrals are all about keeping a business vital and successful.

The next question is called "what's hot?" If you have a salesperson that says that nothing's hot, then they're not able to create a sense of urgency. On the other hand, if they said, "I've got a big opportunity down in Phoenix. It sounds really good. I've already been out there and talked to them", you might say, "Hey, let's get an appointment. Let's both hop on the plane. Let's go down there and see if we can win that business." So as a sales manager you get to bring that approach to the best opportunities for you to help your salespeople be successful.

The last question is called "what's next?" You end the interview with a salesperson by saying, "Between now and the next time we meet, what are you going to do? What are the next steps?"

I've laid out four very simple questions that I've got clients all over the country using. It's not elaborate. It doesn't need a Power Point presentation to get it across. You don't need a sophisticated database to manage it. All you need to do is let the salespeople know you care about them, and the way you do that is by asking the questions. "What did you sell? What's new? What's how? What's next?"

I've tried to give you today a glimpse of what it's like to be a sales manager, whether you're managing yourself, or whether you're managed by someone else, or whether you're a sales manager. I've given you two major concepts. One is the theory of ARA for understanding how you would develop a management style. The second thing is the four questions that you ought to be asking your salespeople every time you meet with them.

This was a partial transcript from Warren Wechsler's weekly radio show. Warren Wechsler, bestselling author and national sales and motivational speaker, provides many valuable resources free of charge to sales trainers and sales managers. Visit Warren's web site www.totalselling.com Also, listen to Warren's weekly radio broadcast Wednesday's at 4:05 - 5:00 pm Central time, on KMCD-AM 1570AM. Shows are broadcast live on the internet at http://www.warpradio.com/asx/KMCD-AM.asx