Why Some Companies are Giving Up On Sales People

In the face of these increasing demands on salespeople, most companies are simply giving up. Many companies don’t even bother trying to train their salespeople to know or do anything more than the minimum, usually product training, that they need a salesperson to know and do. This is particularly evident with the front-end of the sales process (i.e. lead generation,) where marketing is assigned the job of getting the buyer’s attention, educating prospects, creating interest and urgency, and even uncovering needs. And while clever advertising was originally designed to help make salespeople more efficient, it now attempts to replace them altogether.

Even in sophisticated industrial sales, salespeople are often little more than “bag-men” for the collateral material created by the marketing unit. Why? Because it’s just too expensive and risky to create a competent salesperson, no less a whole team of them, who can find and close new business, and who can then simply leave the company – not only with their new skills and the company’s intellectual property, but with its customers, as well. At least if the marketing program generates the sales leads, the company still owns the leads, even if it is vastly more expensive and less effective to do it that way.

Sometimes companies solve the problem by hiring only experienced salespeople who come with a list of contacts, or even a book of business. Notwithstanding the legal or ethical issues, leveraging the willingness of a salesperson to pirate business from his previous employer simply begs the threat of his pirating them on behalf of his next.

Other companies will just churn and burn new salespeople, converting customers into “house accounts” as they turn over their sales force (releasing experienced and expensive salespeople, and replacing them with new and inexpensive salespeople) in an effort to keep the funnel full. This approach of using the recruiting process as a marketing crutch is often paired with a commission-only compensation system, a truly Darwinian solution to the problem.

Yet another solution that companies try in order to increase sales productivity is to off-load “non-sales” tasks from the sales job. And stripping down the sales role to only its “finding and closing new business” functions is often a good idea, assuming you have salespeople who can, at least, do it. Any time you can use project managers, account managers, technical sales representatives, business owners, sales managers, A/R clerks, product managers, inside salespeople or other support staff to take over traditional parts of the sales job (often even before the sale is closed) you free up the salesperson to do more prospecting and closing.

Sometimes this is done because of the complexity of the account control problem, which has at least two dimensions: First, having more “touch points” gives the company, rather than the salesperson, the account control and the ownership of the account. Second, today even simple sales often involve complex relationships, where there is cross selling, loyalty and affinity programs, post-sales relationships, technical requirements, support, etc., that need people other than the primary salesperson to be responsible.

But stripping down the sales role to only finding and closing new business often enables the company to use other less expensive and less flexible people for non-sales parts of the job in order to free up the salespeople to focus on actually selling – however it’s defined.

From the company’s perspective, by the way, this is almost always an effective strategy, assuming they can afford the extra staff. Once a company realizes that they can’t find, train, or retain good salespeople who can consistently ring the cash register, and also do all the other parts of the job, the off-loading begins. This often happens, ironically, as the result of a specific skill deficiency of a salesperson or sales team. The irony, of course, is that if you have a salesperson who can’t sell (and spending time on non-sales functions is a good indicator that the person can’t sell, and is therefore avoiding selling,) why would you take away the non-sales responsibilities from them? Obviously, the idea is to free them up to have more time to sell. But if the problem is that they can’t sell – i.e. not that they don’t have time to sell – what have you really accomplished?

In an attempt to solve the problem, though, a company may increase its inside sales staff to free the outside salespeople from account servicing responsibilities. Or they may add a marketing person to send out letters, plan seminars or prepare for trade shows, so the salespeople have more time for actual selling. They may bring on manufacturer’s reps or VARs because their current sales team can’t cover the territory adequately. Or they may hire a telemarketing firm to generate leads. And the trend is inevitable as selling situations become more and more complex, if not simply (and more obviously) because the salespeople have trouble with prospecting.

But when you start talking about off-loading key functions like lead generation from the sales job, it begs the question: What is the real sales role? And, for that matter, what is lead generation if it’s not a fundamental part of sales? And can it, and should it, be stripped out of the sales job?

Certainly, whatever the answer, like any other decision in business it should be made on the basis of ROI. That is, would you get a better ROI if your salespeople did their own lead generation, if you hired someone to do it, or if you outsourced it?

In order to answer the question, though, you’ll need to start with an understanding of what lead generation is, how to do it, and how to do it well – even, and especially, if you’re going to do it yourself, but also if you’re thinking of outsourcing it.

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