The Startup Sales Manager

My last post inspired some very insightful commentary, including one comment from a very seasoned IT sales executive about the importance of getting incentive compensation, spiffs and rewards right. He highlighted his success with the implementation of a President’s Club, a scheme that enabled the top ten percent of his sales force to go on a weeklong retreat to an exotic locale once a year.  I am a huge proponent of these kind of programs. They not only foster healthy competition and team cohesion but they also bind your very best people to the organization by creating wonderful, memorable experiences.

Unfortunately, President’s club (or ‘Club’ as it’s often called) is usually not an appropriate incentive at an startup. The reasons for this are as follows:

• Lack of Product Market Fit: Most startups I have worked at initiate early sales efforts in an attempt to validate their proposition or establish a beachhead sector and ideal entry point for their offering. Many of their earliest customers got advantageous terms in exchange for acting as references or informing the onward development of the product. It would be strange to fly the team to the Caribbean as a reward for writing loss-leader business.
• No repeatable sales model: The first year of selling at a B2B startup is generally a time of experimentation. High touch? Low touch? Inside? Outside? Direct?  Channel? Until these questions are answered decisively, there’s simply no point putting a gigantic year end spiff on the table. You want to avoid setting your renaissance reps up for failure.
• Cash is King: Whatever the folks at Tech Crunch say, this ain’t the dot com era. The days of junkets, nightclubbing and lavish employee perks are a thing of the past  (at least they are for B2B startups). It might be prudent to do whatever you can to conserve capital. Save Club for when you’re cash flow positive.

OK, so you’ve developed your first reference clients and your inbound marketing program is starting to bare fruit in the form of inbound inquiries, many of which are successfully converted by your telemarketing team into BANT qualified leads. You’ve retained your first ‘Renaissance’ sales rep to mop up this newfound capacity, an articulate college graduate with two years of dialing for dollars in a fixed-line telephony business under his belt. You know he’s hungry for professional advancement and money. He’s raw but he’s smart. How will you get him ramped and productive?

You could do what many large established businesses do and plug him into a sales methodology like Solution Selling, SPIN or Miler Heiman. Before you do remember that such players are full of ‘Coin-Operated’ sales representatives, journeymen who you cannot afford to have on your team. Remember also that your competitors will leverage the same tactics to ramp their reps. It may be a radical assertion, but I would avoid formal sales training for awhile in favor of what I think of as the true key to startup sales success: preparation. Sounds vague, right? Not very descriptive. Allow me to elaborate.

When I discuss preparation in the context of training and ramping a sales rep, I mean inculcating him with a set of behaviors that will not only improve his chances of lifelong professional success but also ensure that your customers are delighted from the first touch, that their buying experience is wonderful enough to give them a warm feeling every time they think of your brand. It is also the key to building a high performance sales culture.

Preparation doesn’t come out of text book or a canned sales training course. It is a disciplined approach to understanding customers and their needs. It’s also what the world’s best athletes do routinely. Like a baseball pitcher reviewing hours of tape to prepare to face hitters, a distance runner training at altitude or a tennis player hitting thousands of ground strokes a day, so your reps must also prepare. It’s grueling, it’s hard. It’s what winners do.

So how do sales reps prepare? Here are some key activities that all salespeople must undertake daily if they are to be the very best:

Comprehensively understand the customer’s working environment and priorities: My customers are mostly senior IT decision makers. In order to prepare myself to sell to them I read books on Enterprise Application Integration, Network Administration, Computer Science and Cloud Computing. I also read all of the key IT blogs and publications. I know I have to speak in their vernacular if I am to gain their trust. I also know that I have to have a strong grasp of how their strategy is evolving. Is IT outsourcing topical? I have to be able to speak to it. Are they migrating their systems to the cloud? If so, it’s my job  to deeply understand the challenges inherent in such a transition.

Solution selling (by which I mean the socratic process of unearthing a need and selling to it) is not possible in the absence of trust. If your reps do not have a clear understanding of what their customers do and what their challenges are, then they will be lumped in with the other  ”salesmen” – a term that is synonymous with “scammer’ in the mind of many buyers.

So, how can you develop this kind of understanding and sensitivity in your reps? MAKE THEM READ! MAKE THEM CRAM! If they’re not reading a book a week for the first two months, then make it an MBO and bonus them on success in this area. Once they have begun to familiarize themselves with the landscape, engage them in debate and discussion every day. Make them present. Role play. Include them in strategic meetings. Brainstorm which questions they can ask their prospects to get to the heart of their requirement. After a quarter or so they will be ready have truly consultative discourse with prospects.

Caution: Make sure that, once ramped, your reps stay fresh by keeping up to date with key events and shifts in your target market. Assess their comprehension continuously. Take steps to discourage complacency.

Review Tape: Got an inside team? Record their discussions with customers and prospects. Are your reps out in the field? Equip them with LiveScribe pens  and make uploading the resulting wav files into the CRM a bonus-able activity. Sitting down with your reps, one-on-one, once a week and reviewing these recordings will be a wonderful learning experience for all. It will not only keep you, the sales manager, close to the customers and their ever changing needs, but it will also make your reps understand that pitching is an iterative activity, requiring constant innovation and improvement. The advice you give them in the context of such a review will carry real weight. The praise and encouragement you give them will be much more meaningful.

It is of vital importance to note that this is not a simple training exercise. Sales pros and rookies alike require this kind of  review. It is is a critical component in measuring the effectiveness of your team. It also removes speculation and keeps everyone marching in lockstep.

Blog, tweet and post: Building a personal brand is a critical prospecting activity. Get your reps listening to their target audience on forums and in communities. Familiarize them with engagement techniques and get them posting. Ask them to write a short industry focused blog (no more then 250 words a week). Get them tweeting the company blog posts, webinars , whitepaper releases and relevant articles and postings that they find through their own research. This activity will align them with the marketing team and mature their thinking about their market and their prospects’ challenges. Make this a bonused activity and work with them to measure results and refine content.

Caution: Ensure that all rep produced content is both explicitly personal (i.e not produced under the corporate brand) and subject to editorial oversight.

What is the result of implementing the above strategies? Ideally, you’ll end up with sales representative who, by virtue of their understanding and sympathy for their customers’ challenges, can provide meaningful solutions and, in doing so, create remarkable experiences for customers. You’ll also avoid complacency through keeping the dialogue fresh and religiously reviewing tape. Get them ramped  and then implement your sales methodology. They’ll get more out of it. Believe me.

The rewards of this approach are manifold: One of my sales reps once showed me an email in which his customer remarked that ‘everyone at your organization is clearly very smart’. Bingo.

Hiring sales people at a startup business can be a challenge. In my last blog post I delineated  five ways that startups can de-risk the sales hiring process. I have since read this rather excellent article entitled “The Sales Learning Curve” by Mark Leslie and Charles Holloway over at the Harvard Business Review. Messrs. Leslie and Holloway also focus on best practice in this area. They breakdown sales candidates into three profiles: “Renaissance” Reps, “Enlightened Reps” and “Coin-Operated” Reps. Each profile aligns with where a businesses is in it’s learning curve.

Renaissance Reps: are uber-eagles. They are integral to the customer development process and ideal for early (seed) stage businesses. They are not only adept at gathering requirements but they also aggressively learn what they need to know to articulate the proposition. They even create their own collateral, if necessary. Renaissance reps make sales but  they also help the business to learn what the ideal sales model, product positioning and entry points are. They establish product market fit. If your business needs to pivot these guys will be amongst the first to know.

Enlightened Reps: are Eagles. You would look to hire to this profile when you have gained notable traction in you target market and are getting closer to a repeatable sales model. Such salespeople need more training and resourcing than Renaissance reps do, but are still very driven and self sufficient. They do not mind operating in the absence of a proven sales and marketing model and will happily do whatever is necessary to generate leads, be it coldcalling or networking.

Coin Operated Reps: are journeymen. When you find yourself hiring to this profile it’s time to break out the bubbly. You’ve arrived! You have a repeatable sales and marketing model. In fact, you’re generating so many leads that sales is now merely a fulfillment exercise. While this class of rep must be experienced and presentable, it is no longer critical that they possess the intellectual horsepower or self reliance of the Enlightened or Renaissance profile. Con-ops need a lot of resources and require substantial monitoring, so make sure that you are churning out leads and are have documented sales processes in place before hiring any.

It should now be pretty clear which type of rep you need to focus on hiring. There is one last profile to consider: that of your sales manager. Getting this right is key to your success. Hiring a delegator to manage Renaissance or Enlightened reps will be a disaster. They will quickly learn that they know more than she does and end around her when they need solutions or, even worse, quit in disgust and join up with more established competitors. This class of reps are you crown jewels. The only appropriate custodian for them is someone who understands and appreciates what they bring. I refer, of course, to the hands-on manager:

Hands-On Sales Managers: possess all of the characteristics needed to establish and execute against a sales strategy. However they are also themselves excellent salespeople. They are prepared to pick up the phone and call alongside their reps. They possess expert knowledge about the product, target market and competitors. They collaborate well with marketing, making it easy to align the two functions. Having these strengths means they are always the most logical escalation point for reps. They are the go-to resource for anything and everything (speaking to prospects, closing, training, data-sourcing) because they consistently provide solutions.

One sales manager  I worked with at an IT infrastructure company was very fond of saying “I hate IT but I know sales”. This thinking has no place in a startup. Save that kind of lofty, remote management style for a fully scaled corporate sales organization. If your VP sales can’t get down in the trenches with the team, can’t tell the story as well or better than the best of them, can’t fluently describe a day in the life of the prospect, then you may want to reconsider your choice. Your success depends on it.