:: Words of sales test wisdom from those who know ::

A US subsidiary of a FTSE 250 company in the engineering sector was suffering a disproportionately high drop off in revenue during the early days of the recent recession. It’s now back on track after analysis of its sales organisation identified major skills gaps and the company replaced incumbents with fewer, more effective salespeople.

This is the story of a US subsidiary of a well known FTSE 250 company whose order book took an unexpected and very steep dive at the start of the recent recession.

In the past, the company had grown primarily by acquisition of competitors or businesses in new technology areas and inherited a large number of long-standing customers.

However, during the recession, business dropped away dramatically, causing significant issues for the organisation by seriously affecting profitability. Yet, the same picture was not repeated at its major competitors.

The new VP of Human Resources decided to take a close look at the sales team to try to understand what role they may have played in this decline.

Following Fit-4 assessments and other analysis, it emerged that the organisation’s sales force consisted largely of former customer technical liaison contacts who had been moved into sales – ie the ‘salespeople’ found themselves selling by accident. This situation was compounded as the organisation acquired additional businesses with a similar way of operating.

The recession brought with it increased buyer pressure and dealings with customers began to change from friendly technical relationships to hard-nosed commercial interactions. The buyers were being asked to provide evidence of their choice of supplier based on ‘business value’ and so the company began to lose deals to competitors when its salespeople were unable to respond. The situation was made worse when a major competitor put in a new sales force itself and began to steal substantial market share.

Comprehensive analysis of the sales force found that most individuals had low sales confidence, low sales drive, low sale resilience and didn’t listen. Furthermore, they were poor at numeric and verbal reasoning, and so formed a group of people who were not suited to be in sales at this level.

A detailed picture of the sales force’s skills, competencies, intellect and motivation suggested that existing members of the team would never become good salespeople. What’s more, the company could not make a business case for the potential cost of training them up to become even average salespeople.

So the organisation took the potentially risky decision to fire the whole sales team, because it was cheaper to make the incumbents redundant and recruit new blood at a ratio of one new salesperson for every three fired.

This action delivered immediate benefits:

• it instantly ‘raised the bar’ for the whole sales force with new recruits hired using Fit-4 to ensure they matched the right profile;
• the competitive slide was reversed;
• profitability was dramatically improved thanks to resulting higher revenue and reduced sales costs because of the smaller team; and
• the team is now on course to be above target for profit and revenue in the next financial year.

No Comments

No comments yet.

Comments RSS

Sorry, the comment form is closed at this time.