Sales teams are molded into many organizational structures. They range from having dedicated sales managers who don’t sell, to having a single sales manager who also sells, to having a CEO that manages the sales team. Which one is the right fit for your organization?
Structure 1: Dedicated Sales Manager
Having a dedicated sales manager is the most productive structure for a sales team and the one most world-class sales organizations maintain. When assessing sales teams, a frequent questions arises: “How many sales reps should a sales manager oversee?” The real answer is that “it depends.” A single sales manager may be hard-pressed to effectively manage more than 12 salespeople.
Many variables impact the appropriate ratio of manger to sales team members, including geography, complexity of the sale and relative proficiency and tenure of the salespeople on the team. To maintain appropriate levels of interaction with sales team members, managers need to do a suitable amount of coaching and be able to hold people accountable to the right behaviors.
Over the years, I have seen two main issues repeatedly arise with the dedicated sales manager structure:
1. CEOs frequently promote their best salesperson to sales manager as a reward. Often, this turns out to be a disaster. Don’t just promote your favorite salesperson to the role of manager unless you are certain he or she can be effective. You run the risk of him or her failing at manager and also losing your best salesperson. The role of sales manager requires significantly different skill sets than that of a salesperson. In sales, a combination of skills may include hunting, qualifying, selling consultatively, closing, farming and account managing. In sales management, skills of coaching, motivating, holding people accountable and recruiting are valuable.
2. The CEO does not manage the sales manager effectively. If you have one or multiple sales managers, your role as CEO is to “manage” them. You must hold your sales managers accountable to certain behaviors, just like they must hold their salespeople accountable.
Your sales managers should hold regular team meetings to focus everyone’s attention on the important items. If you hold your managers accountable to this type of discipline, you will see sales soar. Sales managers should also be conducting weekly one-on-one meetings for coaching and accountability purposes.
The sales manager needs to continually focus on four disciplines: goals, pipeline management, salespersons’ activity and coaching for effectiveness improvement. For example, when the sales manager asks the sales team about the items on the pipeline, request that the sales manager report back to you on the health and predictability of the pipeline. Hold the manager accountable to owning all the opportunities in the pipeline by making sure that he or she supports their positioning on the pipeline. Ask the sales manager specific questions about team activity, such as: Did the team have 20 first appointments this week? If not, why not? What is going to be done differently next week? Managers will in turn ask those exact same questions to team members with regard to their own activity.
Structure 2: Sales Manager with a Personal Sales Quota
Giving a sales quota to the sales manager may seem necessary, but it is rarely a productive structure. If it is more lucrative for the sales manager to close his own deals, there will be no incentive for the sales manager to help the team grow, develop and increase revenue. The sales manager will be conflicted on where to spend his or her time and might compete with salespeople for deals. The sales manager will be pulled in competing directions.
You need to hold the sales manager accountable for sales management behaviors with the team, but you must also become sales manager of him or her. Have specific, scheduled weekly meetings for his or her accountability, but also have weekly one-on-ones to oversee the manager’s behavior as a salesperson. The manager should have an activity plan like the salespeople.