The Downfall of Sales Management and SFA/CRM

The impacts--both positive and negative--of sales management on any organization are immense. High-performance sales organizations and companies are led by individuals who understand the critical role of sales management. Today there are too many under-performing organizations led by inept sales management who have revealed the failure of traditional SFA/CRM. Sales management has become lax in defining its role and executing its responsibilities. This lack of focus, understanding, and performance has allowed sales organizations to slack off. During the positive economic environment of a few years ago, sales organizations effortlessly overperformed, not because of sales management, rather in spite of it. Today's more difficult economic situation has brought the sins of ineffective sales management home to roost at top management's and the board of directors' doorstep. Sales management must focus on building organizations to succeed during down cycles and excel during upswings. In misunderstanding its role sales management confuses the definition of leadership
with management. Leadership is the ability to make things happen by encouraging and channeling the contributions of others, taking a stand on and addressing important issues, and acting as a catalyst for change and continuous improvement. Take special note of "encouraging, taking a stand, and acting as a catalyst for change and improvement." These are action words focused on proactive stance, not reactive emotions. When sales leaders fail to set standards and do not take action, they erode previously established standards. This erosion brings achievement to the level of the least successful salesperson. In this instance sales management is not a catalyst for growth or continuous improvement. This lack of accountability impairs SFA/CRM's potential to foster productivity. Individuals who are responsible for sales have become "managers." Management is the skill of attaining predefined objectives with and through the voluntary cooperation and effort of other people. Note the key words "skill, attaining predefined objectives, and effort." As a skill, management can be learned. Attaining predefined objectives indicates that someone else has set the goals, and managers measure results. Leaders set objectives and hold people accountable. Why has SFA/CRM failed to aid sales management? Because it's focused primarily on pipeline management. Holding salespeople accountable for pipeline values historically has been the role of the sales manager. While this fundamental element of SFA/CRM is important, it is only one minor criterion for successful sales organizations. Successful companies share a few more important traits:
  • Excellent management decisions
  • Focus on people and culture
  • Attaining customer results
  • Attaining company results Successful sales leaders focus on people and culture. Many who have focused on management have cut costs, managed based on pipeline value, activity workloads, or by numbers or dollar values. Failing sales managers have focused on "holding firm" on their numbers and worse, allowed underachievers to survive in their organization. Successful sales management leaders have created or used systems to provide focus on helping the successful and average producers succeed at greater levels. Systems are designed to help build the success levels and personal skills of salespeople and allow individuals to set goals for themselves that are in alignment with corporate goals and set their expectations for achievement. Sales management must agree to these goals and ensure they meet or exceed necessary company expectations. They must then work, coach, mentor, and inspect the salesperson's achievement towards those objectives. The role of sales management is to understand the individual's objectives, and if the individual does not achieve their commitments, take corrective action or terminate their employment. Successful sales management must follow the following fundamentals to build a sales organization that will achieve continuous long-term results:
  • Develop and share sense of mission or purpose
  • Have clear and attainable goals
  • Provide frequent objective feedback
  • Provide positive rewards for appropriate performance
  • Give timely support and help when requested or needed However, most CRM/SFA applications do not assist the sales manager in creating an environment that provides for coaching, individual salesperson goal setting, determining sales tactical goals and personal development plans. Effective CRM/SFA must include tools to assist experienced and novice sales leaders in holding sales people accountable for meeting their goals and the company's goals. These software applications must include personal salesperson goals setting, personal development, and salesperson networking commitments, marketing program development, and company achievement. And yes, quota attainment. In today's environment sales management must learn that setting standards is easy, but holding salespeople accountable for self-imposed and company-imposed standards is critical. Most important: Taking the right action when standards are not met is the essential difference between leadership and management. This requires understanding the basic elements of high-performance organizations...that great people work toward higher self-imposed standards, and the job of sales management is to hold people accountable for achieving those standards. About the Author Ken Thoreson is managing partner of Acumen Management Group Ltd., a North America--based consulting organization focused on improving the sales management functions within growing and transitional organizations.
  • CRM Covers
    for qualified subscribers
    Subscribe Now Current Issue Past Issues