Startling data on how much of a "revenue hit" companies take when a high performing Sales Exec (SE) leaves… I crunched some numbers and calculated that a $3mm/year producer in a $100mm top-line company costs that company $2,540,000 in lost revenue in the following year after that rep leaves. (That's assuming the chair gets filled 90 days after s/he departs.) That figure DOESN'T include recruiter fees and Sales Manager (SM) time to keep fingers in the dike.
But the bleeding continues.... the replacement rep will not immediately produce at levels of the departed rep, and therefore in year 2, the departed SE costs the company $1,278,000 in lost revenue. The two-year total of lost revenue to the company is $3,818,000. YIKES.
Takeaway: me thinks SMs should improve how they communicate with the SEs who are pounding the pavement for us! SEs are the lifeblood of the company and management needs to understand how to keep them tucked-in and motivated, which bring us to...
If that promotional paragraph on the previous link is still fresh in your brain, then join me for the chorus: "what a bunch of bull----". Here, again, is the promo statement from the company I found purporting to help with seller performance:
"_____" offers the industry's leading sales acceleration platform built on "______", a predictive and prescriptive self-learning engine that drives revenue growth by delivering an optimized experience for both salesperson and buyer. The platform fuels sales rep performance and provides buyer personalization with breakthrough innovations in predictive sales communications, engagement tracking, forecasting, rep motivation, and hiring."
Don't know about you, but my hackle goes up when I read buzz-words and phrases like these:
"predictive and prescriptive self-learning"
"optimized experience for both salesperson and buyer" (huh? how's THAT work?)
"predictive sales communications"
What is all that? More importantly, why am I so hot about this? (Cuz I am.)
For the last four years I have invested an immense amount of time to really understand what is ailing B2B sales orgs - and the sad news is most of them are dysfunctional and could be operating at a much higher level. Here's what I conclude:
B2B sales orgs don't need another CRM, they need to know how to have conversations about performance and the associated behaviors that drive results!
The company who is promoting themselves through the highlighted paragraph has great intentions and I applaud them - basically we're motivated by the same thing. But they're masquerading a CRM as a performance tool so they can sell software, and software doesn't solve the underlying problem in B2B sales orgs: communication is dysfunctional amidst sales ranks.
With tons of VC money funding SaaS companies, it's easy to see how CRMs are as common as Circle-Ks and CVS drugstores. But by nature, CRMs don't address skill issues that are foundational to performance. A strong performance management protocol forces communication that focuses attention on skill development and behavior performance! (At its core, STAR is a communication facilitator...a highly specialized, B2B-focused communication facilitator.)
Until sales orgs realize that the focus has to be on "managing performance, NOT results", they will not do the things that actually matter to Sales Executives (SEs). SEs don't want another portal...they want a deeper relationship with a teacher who knows specifically how to guide their talents and potential towards higher productivity (and eventually, results).
Manage performance, not results!
Sales orgs who manage individual behaviors and actions will be rewarded. Manage your team that way, and results will flow!
Again, MANAGE PERFORMANCE, NOT RESULTS!
Welcome to this forum focusing on performance management issues. As you know, I'm fiercely passionate about helping Sales Managers and Sales Executives be the best they can be in their career pursuits. This is why I created STAR, and it's why I'll be posting about performance management issues.