Embrace Formal Sales Coaching

Research from CSO Insights suggests that formal sales coaching methods are more effective than unstructured approaches, but few companies are currently using them.

In its 2015 Sales Management Optimization Study, the firm found that coaching accounts for 21.8 percent of the typical sales manager's work week in most organizations. On average, managers spent 1.4 hours per week training each of the 6.2 salespeople on their teams.

When it comes to coaching methods, 42.1 percent of firms give sales managers autonomy in deciding how to proceed. Additionally, 33.5 percent of firms had an informal process in place that encouraged, but did not force, managers to employ a formal process; and only 24.4 percent had formal approaches in place and required managers to use them.

Companies that don't employ formal coaching processes do so at their own risk. Companies with formal processes had win rates of 53.6 percent, while those with less structured processes closed sales slightly less than 45 percent of the time, according to the research.

While establishing a formal coaching process "requires an investment, the expected increase in revenue from closing more deals could easily offset that cost," Kim Cameron, vice president of research and products at CSO Insights, wrote in a recent blog post about the study.

To improve, "companies need to develop both a formal sales process for salespeople to follow and formal coaching processes for managers to use to enforce and reinforce that process," says Jim Dickie, research fellow at CSO Insights, a division of MHI Global.

Unfortunately, Dickie notes, most organizations still neglect to tackle sales coaching head on. In many cases, the people in charge of managing teams are themselves former salespeople who were promoted based on their performance as reps. Often, they carry that mentality to their new role but don't go through any coaching themselves. "We're not doing a great job at training them and showing them how to make that transition," Dickie says.

Companies should be providing managers with the same type of training that their sales reps receive. Dickie says scenario-based training is often a good way to present managers with real-life situations and gauge their reactions.

Companies should also be investing in technology that places more attention on the sales reps that need added assistance, Dickie says.

To ensure that action is taken, compensation plans should be adjusted to incentivize managers to emphasize continuous sales rep development, he adds.

Paying attention to sales rep development will lead companies to invest in automatic coaching technologies, including those that give sales reps direction during various parts of the sales cycle. "[There] are best practices that we know exist," Dickie says. "[So] why can't we systematize those and have them available to all the reps?"

At this year's CRM Evolution conference, Joe Galvin, chief research officer and executive vice president at CSO Insights, challenged the audience to up their investment in management. "When you look at your training budget, how much do you spend on front-line sales managers?" Galvin asked. "And yet, who do you think is the most influential person in your salespeople's lives? It's the sales manager. He or she shapes their quotas, territories, and perceptions of being promoted."

Dickie asserts that those who fail to take gradual steps to achieving such changes will end up losing in the long term. "It may cost $1,500 to train the manager to be a really great coach, but the payback to the company is in the millions of dollars," he says.

Because change begins at the top, it is up to the chief sales officer to lead by example and inspire changes in attitude, Dickie holds. "If the leader believes that structure is a good thing, you'll see it permeate down the entire organization," he says. "The key to this is to get leaders to start to see what the benefits are."