As you begin 2010 many of you have made decisions to reduce the number of sales reps and employees in your respective organizations. Congratulations, you have cut out some of the fat from your organization. The bean counters and stock markets should probably be happy with you.

Everyone has heard the saying, “if it ain’t broke don’t fix it?” One of my favourite bosses used to say, “if it ain’t broke then break it.” In today’s business environment adaptivity is the key to survival. Let this blog be a wake up call for the pharmaceutical industry. There are fundamental flaws in your business model. It is broken! If you think that cutting people is going to fix the fundamental issues then you will be in the same boat next year and the year after that.

Have you considered whether your business model actually makes sense? Have you asked your customers what they want? Do your sales reps actually make a difference when calling on their physicians?

Have you asked yourself why physicians don’t want to see reps any more? Have you asked physicians how you can better address their needs? I was at my doctor’s office a few weeks ago and we got talking about the Pharma industry? I asked “what do her reps do when they come by the office”.  My doctor told me that the rep drops off samples and sometimes review papers. I then asked if she could name any of her reps and the answer I got was “no”.

Given that there are few new products launches do we still need detailers who drop off samples and make no connection with the doctor? Does your selling model allow your reps to sell? Does it encourage your reps to make a difference?

Presently pharmaceutical companies spend a considerable amount of money having front line sales managers to support their reps.  How many FLM actually understand what their role is? How many go out with a rep and at the end of the day make no impact on from a coaching perspective?

One thing I learned early in my career is that sales/profitability hides many evils. As you look to improve the profitability of your organization here are some of the evils you need to confront when developing a sustainable business model.

1. How can you create moments of magic for your physicians so that they want to see your reps again?
2. How can your sales people actually have an impact on their physicians prescribing behaviour?
3. How can you develop front line sales managers who can have an impact on their sales team and physicians?

The one caution I would make to many of you is not to make the same mistake of going back to the same consulting organizations that have told you in the past to simply add additional sales force. The same consultants that create bi-ads and tri-ads (they must be m-ad).What this industry needs is creative approaches to solving the fundamental evils that are inherent in the detailing business model.

I encourage you to freely comment on my thoughts and exchange your ideas on how we can bring this industry back to its glory days.

I am very excited that my article “5 Ways to Gauge Sales Management Coaching” (below) is one of the top 12 sales articles of 2009. Voting is now taking place for the Top Sales Article of the Year. Please help me by casting your vote. Click here to vote.

5 Ways to Gauge Sales Management Coaching

A highly successful vice president of sales recently shared his frustration with the members of his sales management team, who he felt were focused only on results. He worried that they were not spending any time developing their salespeople.
His longer-term view is based on the belief that developing people to the best of their potential improves performance and retention, and it also helps develop a pool of succession candidates.

Most sales leaders would agree that coaching is the most impactful activity a sales manager can do to drive sales team performance. Studies reinforce this by showing that above-average coaches deliver 20 percent more sales.
 

The challenge?
Sales management coaching is the weakest-performing activity among managers. How do you know if your managers are effective coaches? Here are five ways to find out.

1. Asking vs. Telling
If most of a manager’s interaction with his salespeople includes the words “do this” or “why are you not doing that?” your manager is in “tell mode” rather than “coach mode.” This is highly directive and subservient communication. It does little to motivate salespeople, makes them feel like robots, creates mediocre performers, and strains their relationships with their manager.
Coaching is about asking thoughtful questions. It is based on the belief that individuals have the answers to their own sales challenges. The manager’s role is to help individuals develop their ability to self-direct and solve their own problems. A coach would spend a majority of the time asking “how do you think you can best accomplish this goal?” or “how would you like to address this opportunity?”
Spend 15 minutes in one of your manager’s sales meetings and you can quickly determine which mode she or he operates in.

2. Time Spent in the Field
Managers tend to spend their time on the activities they are the best at and most enjoy. A manager who is fixated on administrative tasks such as submitting reports on time probably enjoys this activity and is less comfortable coaching. A strong manager recognizes the value of finding creative ways to get into the field and spend more time with his or her reps. Remember that administration doesn’t generate revenue or help develop your salespeople. Conversely, time spent in the field improves your salespeople’s ability to be the best they can be, and time in front of the customer is the best return on investment of the manager’s time.

3. Accountability
Coaching is about accelerating a sales rep’s growth and ability to achieve personal goals and reach full potential. Simply put, sales coaching is a four-step process:
1. It identifies opportunities for improvement.
2. It gains commitment.
3. It develops a plan.
4. It sets an accountability meeting to discuss progress.
Set aside one hour a month to review your managers’ field visit reports. You are looking for progress toward improving one or two areas of a rep’s development.

4. Sales Rep Engagement and Turnover
Many companies track two metrics. First, they perform an annual engagement survey in which the key is to drill down to the level of the sales manager. This provides insight into the differences between managers as well as the managers’ effectiveness in coaching their reps. Effective coaches will score much higher in sales rep engagement. Second, turnover is also a sign of reps’ relationships with their managers. In fact 70 percent of top performers who leave will do so based on their relationships with their managers.

5. Observation
Spend a couple of days in the field each month getting to know your managers. Ask them about their day’s work with your salespeople and find out about their development plans. Ask them about the level and quality of coaching they are getting. Consider sitting in with a sales manager and his rep for a day. You observe the coach at work and get a firsthand perspective on the coaching effectiveness.

Despite the economic downturn progressive sales organizations are continuing to invest 2-5% of their annual sales budgets in sales training and development. These organizations undoubtedly will outperform their competitors who don’t invest. Training and development is one of the key factors that lead to improved sales performance.

The problem is that 90% of sales training is a waste of time and money. Most sales training is an event. It may increase sales force engagement but has little lasting impact. Without effective reinforcement the impact of your training will be lost within 30 days. The basis of reinforcement comes from sales managers coaching reps, post-training.

Post-training sales coaching and reinforcement is the key to sustaining your sales training investment. We know that coaching is the No. 1 sales management activity that drives sales performance. Studies reinforce this by showing that above-average coaches deliver 20% more sales. The challenge is that sales coaching is the weakest-performing activity among managers.

Before you invest $1 in training you need to find out how effective your sales managers are at coaching in order to maximise your sales training investment. In fact if you only had $1 to invest I would suggest that you would get the biggest ROI on training your sales managers to be great coaches. Not only will you get better sales results, you will also better leverage additional training investment.

The 4-step process outlined below will give you insight in how to maximise any training investment. The example I use is based on Best Practices For Training Sales Managers to be great coaches. This model is applicable for all training.

Four Step Training Model:

Step 1: Assessing Skills and Behaviors

Assuming you already know what you want to achieve with your training investment (i.e., develop “great sales coaches”) you need to find out where you are before you embark on your journey. It is important to understand the skill level of the people you are training. Many tools can be used to benchmark skills, like 360-degree review. We have developed the Sales Manager Coaching Assessment which benchmarks each sales manager on 6 dimensions of effective coaching. You can also benchmark the level of sales rep engagement in each district as a starting base.

STEP 2: Delivery of Training

Once you have benchmarked the level skill/behaviors/competencies, there are several ways to make the actual delivery of training more impactful. Assign participants advanced reading and other pre-work so they will come to the training with a base level of knowledge as well as some exposure to the content beforehand. Role-playing and case studies allow for real-life application of the learning, which improves understanding and applicability. Trainers who are dynamic and create a high-impact learning environment add to the training experience.

Most trainers will do a “happy face” post-training questionnaire to gauge their effectiveness. All this does is allow them to pat themselves on the back and check the box that they have delivered effective training. As I stated earlier,  the impact of training delivered by the best trainers is lost within 30 days without proper reinforcement.

Step 3: Reinforcement to sustain skills/behavior/competency changes

When sales reps take a training course the responsibility for reinforcement lies with their district sales managers. What happens when a district sales manager is trained? Who is responsible for reinforcing the training? Will the VP of Sales do it? Will the trainer be responsible? If no one does it you can kiss your training dollars good bye.

I have spent a lot of time developing effective reinforcement skills/behaviors/competencies for post-training learning. In the diagram below it is clear that effective training that includes reading, audio visual presentation/lecture and some demonstration will produce knowledge retention of at least 30%.

How do you ensure that you move the retention rate closer to 100%?

I use a multi-pronged approach to ensure that post training reinforcement leads to effective learning and creates sustainable changes in skills, behaviors or competencies. 1-on-1 coaching with a sales management coach is by far the best way to ensure effective results for your training investment. Sharing best practices and discussing challenges with peers in monthly facilitated group tele-sessions has great benefit as well. Lastly, coaching the VP of Sales to effectively role-model and support the training completes the reinforcement process. The bottom line is that coaching reinforces training to establish permanent skill and behavioral changes.
STEP 4 – Reassessing Skills and Behaviors

Six to nine months down the road we reassess the level of skills/competencies /behaviors using the same tool we used up front. This step serves several purposes. First, when training participants know they will be held accountable to demonstrate behavioral/skill/competency development post- training and that they will be measured, you get better results. Second, it allows management to gauge the impact of their investment in training.

This four-step process is the best way to ensure you maximise the ROI of your training dollars.

Do you want to increase your sales performance? Transforming your sales managers from good to great coaches can have a dramatic impact on sales. In fact, sales’ coaching is the management No. 1 activity that drives sales performance. The only problem is that managers have not been taught how to effectively coach. Coaching is a skill that takes time to perfect and unless effectively coached or trained managers make all types of mistakes.

As the head of sales or as a frontline sales manager you can greatly enhance the performance of your sales team if you can develop great coaches.

One of the key mistakes managers make is not getting a commitment to change. They have done a perfect job coaching by asking all right questions, come to agreement on areas for development but forget to get buy in on how the problem will be fixed. When the manger and rep agree on an area for development it is critical to have the rep buys in to what steps they will take to improve.

This requires a simple 3 or 4 point plan which includes what the sales rep will do between coaching sessions. The key is to have the rep develop their own next steps and your role becomes one of holding them accountable. Without this in place the odds are that there will be no change in rep behaviour or skills on the next coaching session.

Sales coaching is the No. 1 management activity that drives sales performance. The only problem is that managers have not been taught how to effectively coach. Coaching is a skill that takes time to perfect and unless effectively coached or trained managers make all types of mistakes. This is the 3rd in a series of coaching pitfalls that mangers should avoid.

Personal growth and change is a challenge for all of us. We all have strengths and areas for development. Mangers who decide who create a laundry list of areas for development, will have little success. It is too difficult for sales rep to make wholesale changes in how they sell. Development is about working on improving 1 or 2 things and once the sales person has demonstrated that they have acquired the skill or behaviour then you can move on to the next area.

From a sales reps perspective imagine getting a field report listing all of the things you do wrong? Some reps would not even read the report. Many will read and wonder where I start. Others may read it and be completely overwhelmed.

Great coaching is about focus focus and focus. Helping a sales rep improve in one area of their job can have a major impact on their performance.

Last week I explored the mistake that many managers make of being in tell mode. Today I want to explore where coaching sits amongst a sales managers many priorities.

Time management is a challenge we all face. With emails, meetings and administrative work what is a sales manager to do? If sales results are what you desire then the easy answer is to do the activities that will drive the greatest revenue. Generally we do the busy work first as they are the easiest to. It feels good when we are up to date on our emails. The stress is reduced when we have all our reports in on time and we have followed up on all our messages.

But all those activities don’t contribute to the bottom line. If great sales coaching can have a direct impact of up to 19% more sales, why is coaching not the #1 priority?

Stop making excuses and get out of the office. Get out in the field and make coaching your #1 priority. Your boss will thank you and your reps will make lots of money.

In my last post I told you about my lunch with a VP of sales who was frustrated because the members of his sales management team were focused so exclusively on results that they neglected the care and feeding of their salespeople.

That executive sees the role of the sales manager as developing his or her people to the best of their potential. I agree with his a longer-term view that by developing your people, you get improved performance and better retention and you essentially develop a pool of succession candidates.

So how exactly do you know if your managers are effective coaches?

Here are five ways of Determining if you have Great Sales Coaches: 

1.      Asking vs. Telling

You can tell much about a manager’s coaching ability by observing the interactions with his or her salespeople. If a majority of the interaction includes the words “do this” or “why are you not doing that,” your manager is in “tell mode.” This highly directive and subservient communication makes salespeople feel like robots and produces mediocre performers. Frankly, it strains their relationship with their manager.

Coaching is about asking thoughtful questions. It is based on the belief that individuals have the answers to their own sales challenges. The manager’s role is to help individuals develop their ability to self-direct and solve their own problems. A coach would spend a majority of the time asking “how do you think you can best accomplish this goal?” or “how would you like to address this opportunity?”

Spend 15 minutes in one of your manager’s sales meeting and you’ll quickly determine if the manager operates in “coach” or “tell” mode.

2.      Time Spent in the Field

Like many of us, managers tend to spend their time on the activities they are the best at and most enjoy.  A manager who focuses extensively on administrative tasks like submitting reports on time probably is less comfortable coaching. The manager who finds creative ways to get into the field and spend more time with sales reps probably sees the value of this time. Remember that administration doesn’t generate revenue or help develop your salespeople and that time spent in the field improves your reps’ ability to be the best they can be.

Do you track the number of days each manager spends in the field?   The best coach likely is the one who does so most often.

3.      Accountability

Coaching is about accelerating a sales rep’s growth and ability to achieve personal goals and reach full potential. It’s a four-step process that: (1) identifies opportunities for improvement, (2) gains commitment, (3) develops a plan and (4) sets an accountability meeting to discuss progress. Set aside one hour a month to review your manager’s field visit reports. Why not go farther and follow three or four field visits with the same rep to see if the accountability for the reps to carry out their self-improvement plan is being reviewed by the sales manager? You are looking for progress toward improving one or two areas of the rep’s development.

4.      Sales Rep Engagement and Turnover

Many companies track two metrics: One, they perform an annual engagement survey in which the key is to drill down to the level of the sales manager. This provides insight into the differences between managers as well as the managers’ effectiveness in coaching their reps. Effective coaches will score much higher in sales rep engagement. Second, turnover is also a sign of reps’ relationships with their managers. In fact, 70% of top performers who leave will do so based on their relationship with their manager.

5.      Get out in the Field

Spend a couple of days in the field each month and get to know your reps.   Ask them about the level and quality of coaching they are getting.  Another approach, the dreaded “co-work with,” involves sitting in with the sales manager and his rep for a day. You observe the coach at work and get a firsthand perspective on the coaching effectiveness. I have never personally done this but I do know a sales director who has utilized this approach and I applaud his resolve.

Here’s to good coaching!

I recently had lunch with a highly successful VP of Sales. He explained that he was frustrated with the members of his sales management team, who he felt were focused only on results. He worried that they were not spending any time developing their salespeople.

At first blush, most of you might easily say you don’t see a problem with that. You wish your sales managers were more focused on delivering the sales numbers. That’s easily understood and probably true in many cases.

So why was my lunchmate so frustrated? Simply put, he believes sales managers should be developing his or her people to the best of their potential. He has an admirable longer-term view that is based on the belief that by developing your people, you get improved performance and better retention and you essentially develop a pool of succession candidates.

Most sales leaders would agree that a sales manager really can jumpstart a sales rep’s performance through coaching.  Studies reinforce this by showing that above-average coaches deliver 20% more sales. However, it also is true – and a major challenge – that managers generally have the greatest difficulty trying to coach their people.

So as the head of sales, you typically don’t oversee the coaching effectiveness of your team. How do you know how good your sales managers are at coaching? How do you know who are your best and worst coaches?

These are valid concerns, and deserve close attention. Read my next post for five ways to determine if you have great sales coaches.

It’s Q1 2009 and your sales are down, what can you do?

I faced a similar situation in Q1 2003. As VP of Sales of a Canadian pharmaceutical organization we faced the SARS crisis. Access to our customers became limited. Hospitals and physicians were also limiting sales rep visits.

Marketing started calling the sales numbers down for the year, blaming the SARS crisis. As head of sales I had few options. What I did know was that I had to utilize my resources where they were going to generate the greatest revenue.

Back to basics:

In sales your biggest resource is your sales force. The best place to deploy your sales force is in the field. The field is where they generate revenue. So we went back to basics. Activities such as administration, training and meetings are all important, but are non revenue generating. We initiated a simple 3 point plan:

1. All training was cancelled. Trainers were redeployed into the field to help coach sales reps.
2. Sales managers focused on field visits and were in the field four to five days a week.
3. Sales reps found creative ways to see their clients or focus-in on hospitals and physicians they could access. Their goal was to focus on making more sales calls.

These 3 basic steps allowed us to over achieve our sales targets by year end. In the end, the SARS crisis resolved itself. In 2009, the economy may take much longer to see an upturn, but the basic principles of redeploying your resources on revenue generating activities will still apply. 

Sales leadership is about focusing your resources on what will have the biggest impact.

Focused on your success,

Steven Rosen

www.starresults.com

Meet Jane.

Jane is an experienced and successful district sales manager who could work in any industry and for any company. In fact, there are many Jane’s in all companies. Jane is performance-driven, a very good coach and a people person. Each month Jane is put to the test with different sales reps she must coach to success.

Jane’s Profile:

Current:

District Sales Manager IBZ Inc. 2004-

Past:

Sales Manager Alba Inc. 2000-2004

Product Manager Alba Inc 1996-2000

Sales Rep Alba Inc. 1992-1996

Education:

Business Degree 1992

Courses:

Managing Effort Getting Results 2008

Professional Sales Management 2007

Sales Coaching for Success 2006

Professional Selling 1998

IBZ is a mid-sized technology company that has had some tough years but has turned the corner. It pays its reps a combination of salary and bonus for achievement of targets. This year the bonus plans have a super bonus portion which accelerates when a rep is 5% over quota.

Jane wants to get 2009 off to a great start. However, as she shared in one of our monthly coaching sessions, she is frustrated with one of her most tenured sales reps.

For some background, Jane took over an underperforming region last year and has helped lead the team to be in the top 25% of districts in the country. Jane’s goal in 2009 is to reach the top 10% of the country and she is focused. Her key area of focus is on finding innovative ways to grow the business. She wants her team to develop new business opportunities for lagging product lines.

As she reviews her team, the one rep keeps coming up. Ray has been with the company for over 20 years and has worked with 10 DM’s. He has been on 2 personal improvement programs (PIP) and has won several sales contests in the last few years.

Ray knows his stuff, he knows his customers and he knows how to get others in the office to do his work. When Jane works with Ray she has a good day although she wonders whether he works full days when she is not with him. He picks her up at 8:30 and drops her off around 4:30. The day is well planned and Ray has a good rapport with his customers.

Jane has invested a lot of energy trying to motivate Ray and a lot of time giving him positive feedback on his skills, customer service and business plans and on his year-end review. She would like to see the results if he would put the extra call each day.

In reviewing Ray’s 2009 business plan, Jane determine that he had not included any new target customers or innovative approaches to driving the business further. She is frustrated with Ray’s lack of initiative and drive.

Questions:

1. How do you motivate Ray to put in the extra effort required to be a top rep?

2. How much time would you invest in Ray in 2009?

See my thoughts on this page…..

Dear Jane,

Ray is an example of a rep that has all the talent but lacks consistent effort to be a top performer. The first thing we need to remember as managers is that it is not our job to motivate our reps. External motivation is short-lived. It is not necessarily sustained when you are not with your rep.

Another way to approach Ray is to encourage him to focus on developing new business. He may think he knows best and he will appease you by picking a few accounts. He knows he will have a new manager in time and will outlast that manager as well. Provide Ray with positive reinforcement only when Ray demonstrates that he is driving new business and initiatives. 

You can continue to invest in Ray’s development but will get limited returns for the time you invest. With 8 other reps you can achieve a better ROI by investing in those reps that put out a consistent high level of effort and are self- motivated.

Let me know how it goes,

© Steven Rosen, MBA

Sales Executive Coach