(Part II)
n eight-week “fast forward”
strategic tune-up for small business and middle market banking units that
must generate more sales with smaller staffs in a declining market. Business
strategy development incorporates making selections about the target market(s)
served and products/services sold; it requires a frank assessment of core
strengths, rather than a glossing over of problems or mediocre offerings;
and it leads to trade-offs
between different priorities and goals.
Once
senior managers have agreed on goals and a strategy, the firm’s return on
its strategy depends
on how well
sales
teams focus on the issues and target customers outlined in the strategy. Disciplined, focused ,
focused salesales leadership and
management is the tactical link between thebridge from strategy
and to intended results. Once senior managers
have agreed on goals and a strategy, the firm’s return on its strategy will
fall short of expected targets unless sales teams focus on the issues and
target customers outlined in the strategy.
Develop a ScorecardDevelop A Scoreb Board for Sales
The
first step toward strategy implementation and results is development
of a sales scoreboard that translates the tuned-up strategy into performance
indicators that answer two questions:
A
Sales
Scorecard looks at the present
and the future to answer two questions:
What
are our targets (in addition to the sales results and profits we seek to achieve)?
· Are we executing the right activities to present our value proposition to the right customers in the right way to reach our target?
·
Are we generating the amounts and types of results
our strategy aims for along the way?
A Sales Scorecard should balance external
measures (e.g., sales, market share, and penetration of key accounts) with
internal measures of critical business processes (e.g., response times on
proposals, number of “pitch books” delivered, and costs of delivery). The Sales Scorecard
should include both easily quantified measures as well as more subjective
measures of performance quality and quantity that drive future sales results.
To be effective, the sSales
Scorecardscore board must should drive down to
predictive, leading indicators of sales success, such as: numbers
of sales activities, numbers of new leads,
number
of steps in the sales blueprint completed, sales calls completed,
number of idea presentations completed, numbers of proposals sent, and funnel
conversion rates. Others could include client satisfaction measures and complaint
frequencies, sales rep knowledge of customer issues and solution configurations,
dealer satisfaction, and dealer profitability.
and balance external measures (e.g., sales, market share, and
penetration of key accounts) with internal measures of critical business processes
(e.g., response times on proposals, number of “pitch books” delivered, number of sales
calls completed). The sales score board should include both
easily quantified measures as well as more subjective measures of performance
quality and quantity that drive future sales results.
These numbers will help sales managers understand
how the business development process is working and what kind of revenue can
be expected months down the road. Without such metrics, sales team managers
revert to guessing and managing based solely on past results.
Define
A Sales Blueprint
With
the Sales Scorecard
established, sales managers must establish
a Sales Blueprint. The Sales Blueprint describes the company’s
sales methodology.
In military terms, this would
be called “rules of engagement.” The Blueprint describes how sales teams will
identify prospective clients that match the bank’s strategy, attract their
attention, analyze client business conditions, quantify potential improvements
in business conditions, and present specific strategies for improving operations.
The Blueprint should also describe how internal organizations work
with the sales force during and after the sales process to deliver the value
proposition that the sales force has sold.
Develop
Sales Activity
Plans
Once a bank has defined its strategy and sales blueprintscoreboard, the
next critical tune-up
step involves
activity planning. . Planning
is absolutely fundamental to value-based selling and to boosting market share
and profitability. Sales plans must be more substantial than
“see what you can drum up” because internal resources are more scarce—e
-- banks are asking fewer relationship managers to handle more
accounts with less internal support— -- and
competition is both broader and more aggressive.. Three kinds of planning are
important:
n
Since time is so precious,
the plans should focus on the
most important leverage points -- target customers, critical activities, resources
needed -- to reach the sales goals.
·
Identify Targets: The
first sales team planning challenge is to Targetingidentify
clients and potential clients thatwho
are
the best fit with the bank’s value proposition and strategy,
blueprint, and appetite for credit and other revenue
streams. Banks
that are doing well show
the strongest levels of discipline in looking
for and selecting the kind of business they want to do. This involves thoughtful
and detailed assessment of the companies in a market, comparing them to profiles
that define those most likely to benefit from a particular bank’s expertise.
·
Plan Sales Activities:
Planning The
second sales team planning challenge involves designing sales plansactivities to pursue
the targeted accounts clients patiently and persistently, translating .
Effective plans should translate annual sales goals and score board measures into specific
initiativesactivities,
focusing on accounts, activities, expected results, and resources needed.
·
Coordinating sales team activities, product specialist activities,
and product fulfillment group’s activities to ensure
appropriate availability, focus, and responsiveness. It also involves deploying
sales, credit, and product specialist resources to the most important and
potentially profitable opportunities, matching the best team members with
the best opportunities.
Develop
A Targeted Focus Recognition and Compensation
Plan
Mary
Kay Ash was once quoted as saying, “People want only two things more than sex and money:
pPraise and recognition.” While development of integrated,
strategy-focused compensation plans
proceeds, sales managers must develop local, controllable recognition schemes that shower praise and
recognition on salespeople and support personnel in sales boundary organizations
when they demonstrate implementation
of the new strategy. Praise
and recognition must be frequent, immediate, and consistent. It can be as simple as a brief email or handwritten
note, or as elaborate as “formal” recognition at
quarterly or annual sales team meetings or disbursement of discretionary bonus money.
Meanwhile, sales managers
must drive development of measurement systems and incentive plans that align
with the tuned- up
strategy. Many bank incentive compensation plans are either
too complex (e.g., 23 goals) or they are not focused on the bank’s strategy
(e.g., they reward loan growth when the strategy is focused on generating
broader fee income from non-credit services).
In our experiencStrategy-congruent ie,
commercial ncentive plans should focus salespeople
should be focused on a
relatively small number (5 to 9) of goals that match the bank’s strategies
for acquisition, penetration,
and retention of targeted clients, ; product mix; and revenue
or profits. In the “tune-up” mode, sales
managers may have to develop temporary measurement tools that cut across stove-piped
computer platforms, consolidating data that can be used to measure sales productivity
relative to the strategy. One of our business banking clients, for example,
developed a jury-rigged software application that captured income account
retention, penetration, and new business generation. Incentive compensation should focus on the
most important sales goals.
The
most frequently cited obstacles to such targeted compensation plans are (1)
cost-center centric incentive systems (e.g., we don’t pay our people for the
capital markets fees they generate) and (2)
inability to measure the desired productivity (e.g., we can’t capture
income
from
deposits
that are domiciled in the branches that did but notnot shown up on the commercial line of business income statement. .
Since these are both serious obstacles, bank
managers must dedicate
time (that they’d rather
be spending on other issues)
to develop “shared credit” systems with other lines of
business and sponsoring development of new
software that can cut
across their banks’ stove-piped computer
platforms, consolidating data that can be used to measure sales productivity. While these efforts
are underway, senior sales managers may have to dedicate staff resources to
tracking and reporting activities that are better done by computers.
Provide
Disciplines to Ensure Focused ExecutionFocus on Disciplined Execution
Finally,
sWhen pressed to meet goals in declining or highly
competitive markets, salespeople will approach and sell to anyone who remotely
looks like a potential saleales managers must . ensure that sales people
execute their sales plans by performing the right activities at the right times with the
right clients to implement the strategy. Sales Sales team
leaders must should initiate ensure that sales team
members follow the blueprint and
implement their account plans and territory plans
through a discipline of REGULAR conversations with sales representatives.
The heart of the matter is keeping people focused on the right activities
with the right clients in the right ways at the right times in order to generate
the right value and earn the right revenue in the future.
After initial discussions of the annual plans, we
recommend a consistent pattern of team sales leadermanager/sellerRM
checkpoints that provide a forum for inspection, feedback, and resetting course:
·
Weekly: - focus
on deals and,
activities, field observation, behaviors, and skills
·
Monthly and quarterly : - focus
on execution
of sales plans, “managing the business”, tracking progress
against toward planned objectives and score board measurements
·
Semi-AnnuallyQuarterly: - a formal performance review and formal business plan
review
These coaching disciplines ensure that sales
teams and individual sales representatives are executing the strategy through the Sales
Blueprint. . Sales
managers’ expectations, coupled with feedback, recognition and, and consequences,
change sales behaviors. . In each weekly, monthly,
and quarterly conversation, the manager and RM compare “business planned performance”
described in the written plans with “actual performance,” identify problems,
and reset plans for the period leading to the next meeting.
In
Summary
Our experience indicates that sales success
depends in large part upon
on senior management
’s
development and communication of a clear, and consistent business strategy coupled with .
Additionally, it requires a disciplined
sales management approach, by sales managers and individual
contributors to focus sales activities on clients profiled in the ,
that focuses efforts on the customers
defined by the business strategy
as key targets for services and products. .
While the directions chosen in the strategic
tune -up may require
significant changes in organizational structure and job definitions, compensation
plans, information systems, and even product sets, field sales managers and
call center managers can begin moving their teams quickly and tactically in
the direction outlined in the strategy through development
of transitional Sales Blueprints and a significantly morethrough disciplined
planning and sales management process.
.
Regular
conversations about the plan between sales
team leaders and their direct reports involve one of the most important aspects
of strategy
and sales management the implementation. . The
conversations must reinforce clear priorities and the commitment of resources
that put the company in a strong position to ensure that its strategy
is implemented while broader organizational and technology support is put
in place. .