If Revenue is the Issue, Why Do Presidents Reduce the Sales Staff?

By James W. Obermayer
Sales Leakage Consulting, Inc.

Most company presidents will admit that if revenue increases, nearly all of the problems the company faces will disappear.  And yet, too many companies are firing some of  their salespeople or reducing the total number of salespeople (a bit like stopping their watch to save time).

I can understand replacing people who don't make quota.   Yes, this is a good time to weed the garden and find"A" players who will perform.  It is time to build the sales team, not reduce the number of people who are responsible for bringing in the one thing you desperately need, new customers.    If  reducing the sales staff has crossed you mind, may I first suggest the following:

1. Quotas.  Do the salespeople have monthly (even) weekly quotas?  If not start tomorrow.   It is never too late to do what you should have done in better times. 
2. Under performers? Anyone who has not made quota for three months should be placed on notice.  They are not likely to be paying their way so change them out with a new player if they go another month without making quota. 
3. Coaching? Is the sales manager coaching them daily or at least weekly?  If the manager isn't a coach, find one who is.  This may be your problem.  I asked a sales manager recently, "How often do you coach your salespeople?"  He said monthly.  Is it a coaching meeting I asked? "Well, probably not he said".  My response, fire the manager who isn't a coach. 
4. Over-coming objections.  If you have inside salespeople, listen in on the phone and find out if they are even getting through to decision makers or are they taking the first no as a total rejection?  If they can't get past the first point of rejection , teach them how to ask the proper questions to get to a substantive conversation.    If they still can't do it, find someone who can.
5. Time Management for outside salespeople.    If the outside salespeople are failing, look to time management first and number of contacts touched second.   Where are they spending their time and are they talking to enough people.  See item 6. 
6. To Increase Sales,  Increase sales activity.  Whether they are inside or outside salespeople, increase their sales activities (face to face or sales conversations on the phone) and sales will increase.    Don't know how to measure this?  Read number 7 below.
7. Use the CRM System.  Considering that 80% of the companies have a CRM system, why not make good use of it?  Create an activity report and find out how many sales calls and sales conversations are happening each day/week/month.    If someone can't make more calls, find someone who can. 

If you have taken action on the Seven Steps above, as the head of sales or company president, follow the following fundamentals:

1. Create a handful of rules regarding quotas (how much), calls (how many), appointments  (how many) and proposals (how many).    Get the salespeople to set their own targets, their numbers will most likely be greater than what you come up with.   A CRM system will measure compliance with these rules.
2. Repeat yourself a lot.  Repeat yourself over and over until employees know what you are going to say before you say it, and then say it anyway.   If they are making fun of your insistence on following the rules, you're making progress.
3. Act consistently with those rules

Yep, these are the basic parenting fundamentals, they work for parenting and sales (plus, most other departments in the company).   If you don't have the stomach for it, hire someone who can do it for you.