What makes a world-class sales organization? H.R. Chally, a sales selection and testing company in Dayton, Ohio, interviewed more than 1,100 corporate decision makers to identify the sales organizations rated the best by their customers. The top-ranking companies received the World Class Sales Benchmark Award. To explore the attributes of a world-class sales force, Selling Power sponsored a roundtable conference with award winners and other top companies that contributed to H.R. Chally’s research. These top sales executives discussed five subjects vital to sales success: How to hire and train for maximum performance, what coaching techniques motivate consistently, how to keep pace with change, automation strategies that work, and how to develop leadership skills.

Hiring & training

Selling Power: What is ACDelco’s philosophy of recruiting and training?

Duane Miller: Get the best you can get. We put our candidates through an aptitude testing process. After they pass the test, we create a focus group where about nine different managers interview the candidates. I believe that there are two types of salespeople, those who give you results and those who give you reasons. Results-oriented salespeople create a climate that encourages the customer to buy. During the last 12 months we have recruited about 30 people. We now have a sales force of about 500.

How soon after you’ve hired someone do you know that you don’t have a fit?

Duane Miller: Generally after about six months. The new interviewing process has worked out very well and we make very few hiring mistakes.

How does Exxon Chemical approach training and development?

Cindy Shulman: We look for individuals who have a broad and deep background within our organization. Typically new salespeople at Exxon have experience in the industry or have technical sales backgrounds. The initial sales training during the first three years on the job provides solid sales fundamentals. These cover basic selling skills, negotiation skills, how to write an account plan, how to analyze a customer’s business and how to value our product. After the first three years, salespeople go to such advanced training as understanding new markets and helping clients reach their goals.

Salespeople must be able to understand their customers’ needs in terms of where they want to go. They must figure out how to match up our capabilities with the customer’s needs and how to bring organization to the customer’s goals. There is also a soft side to doing business that requires very intuitive skills. Salespeople must understand what the customer really wants and be able to develop win/win solutions.

How do you train a world-class sales team?

Isabel Kersen: The challenge is how to train salespeople to be good listeners, so they can help customers who do not know exactly what they need. Companies send people with a lot of skills and knowledge into the field with the goal to find that magical match between supply and demand. Salespeople need to understand the customer’s real needs and make the right connection with the company’s solutions. If they are not good at learning, they won’t be able to connect the two. The most important thing we can teach salespeople is how to learn all the time.

Can you teach people how to learn?

Isabel Kersen: Learning is a skill. There are certain thought processes that people may not use, but we can help them learn and practice them. Once you get beyond the age of what we call “monkey see, monkey do,” we begin to learn how to learn.

Rick Buyens: I agree. I sometimes look at salespeople with 10 years of experience who are not succeeding. Their problem is that the sum total of their experience never amounts to more than what they knew at the end of their first year. They fail to grow every year; they did not increase their knowledge and they did not sharpen their skills.

Is continued learning a major factor at Brown-Forman?

Jim Bareuther: Yes. We have aggressively pursued the goal of providing an ongoing learning environment. I don’t think any of us in the room today can convey to an employee as they join the company that they will be in a specific job for the next 20, 30 or 40 years. As the market evolves, our people need to learn more to stay competitive. The old days of visiting a client and going to a ballgame together and getting a sale based on the relationship are no longer a reality.

Coaching & motivation

Selling Power: What motivates your salespeople besides the participation in the profits of UPS?

Joel Rossman: Our salespeople don’t receive commissions, but we have a 90-year history of upward mobility. Most of our senior managers come from within the organization. As you travel through the country, it is not uncommon to meet people who have been in the business for 25 and 30 years. We are a privately held company and we reinvest our profits. We have created a very solid company with exciting opportunities for our partners.

Traditionally managers reward people for delivering high performance; does anyone have a program that is different?

Rick Buyens: At AT&T we have had a long tradition of rewarding the high performers. For example, this year the top 3 percent go to Hawaii, the top 25 percent in my organization go to Naples, Florida. In addition to positive recognition, I believe that there is a need for a program that deals with the poor performers. I asked myself the question, what do we do with those people who are not meeting quota? Why do nonperformers continue to receive base pay? To develop a high-performance team, managers need to do both: reward excellence and deal with poor performers. People need to know that there are consequences when goals are not met. I don’t want salespeople to fall into the entitlement trap. I believe that a sales organization needs positive tension. People need to be held accountable for performance.Isabel Kersen: I agree. In many sales organizations there seems to be a widespread tolerance for mediocrity. These people are not absolute failures, but they are not doing poorly enough to be fired and they keep just going and going.

How does coaching fit with sales management?

Peter Danis: I believe that coaching is increasingly neglected in American business. There is a lot of performance planning, a lot of reviewing and very little coaching.

Mary Committe: I think that it is not done because sales managers don’t know how to do it.

Howard Stevens: We have learned from our benchmarking research that finding the right span of control is very important. If you are a sales manager who supervises 15 or more salespeople, you have little time left for coaching the sales team. The administrative tasks and the paperwork become too demanding.

Mike Wines: We have to encourage our front-line managers to manage people, not things. Get them out of the habit of managing numbers, move away from overanalyzing how many products have been sold, etc. Our front-line managers should focus more on developing their people, helping them with skills development, market development and customer development.

What system do you have in place for coaching at AT&T?

Rick Buyens: We want our sales managers to spend about 40 percent of their time coaching. We roll out our coaching class to all managers. I try to sit down with my general managers twice a year in a formal session and provide informal coaching more frequently.

Isabel Kersen: Most sales managers don’t understand the coaching process. If you ask managers whether they think they have good coaching skills, they quickly say yes, but if you ask them to describe the process, they are not able to do it. If they can’t describe it, they can’t apply it. Most managers confuse coaching with giving directions. They think that if they tell someone to do the job in a certain way, that it means coaching.

Cindy Shulman: I think it is important for salespeople to have strong internal and external industry networks. Mentors also play a key role in providing guidance. It is extremely useful to learn from other people’s successes and failures and to listen to their advice. In larger companies salespeople have a vast experience base to draw on to develop effective and efficient road maps to results. Coaching through mentors, colleagues and supervisors is a valuable and important responsibility.

Managing change

Selling Power: What challenges do you encounter in moving your team to the cutting edge of progress?

Frank Coleman: We are a technology company and we have been very focused on technology training. Selling skills and knowledge of technology are no longer enough for developing effective solutions for our customers. No account executive can possibly understand the broader range of all the technology we have to offer. We expect our account executives to conduct the analysis of the customer’s problem.

We then assemble a team of specialists who create and package a solution and present that to the customer. We are leaders in technology and we plan to expand our business problem-solving skills. Every technological problem has a business side and a technical side. We are now recruiting people with MBA degrees, people who have business administration skills and financial skills. Our goal is to increase the effectiveness of our team and the quality of our solutions.

How does Reynolds & Reynolds deal with the increased demand for business skills?

Mike Wines: In our recruiting process, we look for college graduates with a good business background. We want our company to be their second or third job. Our managers conduct two or three interviews. We are looking for people who are good with solving problems. Teaching selling skills seems to be much easier than teaching business skills. Our people need to identify and solve dealership problems. Ideally, we want our salespeople to be able to show our dealers how they can handle their customers more effectively and how to manage their internal processes better. In the final analysis, the product is only a tool that anyone can learn about. To solve a customer’s business problem you need to have more finesse, education and experience. Better business skills will quickly translate into more business.

Howard Stevens: I think it would be a good idea to look at the nature of the problems that salespeople are asked to solve. In our research we found that in many sales organizations salespeople spent 60 percent of their time fixing problems that their own business systems were supposed to take care of.

Peter Danis: I agree. With all that emphasis on solving business problems, we need to recognize the fact that our systems create more problems than we solve. For example, 5–7 percent of all invoices sent out by American businesses is wrong.

What is the turnover rate at UPS?

Joel Rossman: Our turnover is very low, between 4 and 6 percent. UPS has a very unique culture. When you join UPS you become a partner in our business. We all own a piece of the company and we all have a stake in our success. The majority of our salespeople come from within the organization and they are promoted upward as their skills expand. Salespeople receive a salary and they share in the profits of the company. There are more and more salespeople recruited from the outside. This contributes to a culture change and we now encounter a different set of challenges.

What is the turnover rate at Brown-Forman?

Jim Bareuther: Our turnover rate is generally in the 3 to 5 percent area.

How do you keep it that low?

Jim Bareuther: There are a number of reasons. First, when we recruit people, we look for individuals who have a college degree plus three to four years of sales experience. During the first 24 months, new salespeople go through an extensive training program where we teach effective selling skills and product knowledge, but also focus on building strong relationships with our customers.

We provide a nurturing work environment where people can grow personally and financially, where people receive recognition and rewards. We create an environment where we concentrate on a strong sense of values. We take pride in strong family values. There is a lot of consistency in our culture that translates into greater meaning for our employees. Although we are a public company, the Brown family has controlled Brown-Forman for the past 127 years.

Peter Danis: When I hear about turnover rates of 3 or 5 percent, I say that you don’t have a dynamic organization. Eighty percent of our sales force doesn’t turn at all, but the bottom twenty percent is churning. We take risks. We bring in new people, but some don’t make it and they get out quickly. That bottom 20 percent is like a mixmaster. It means that you either make it and move up, or you don’t. There is no in between.

How do your salespeople at UPS stay competitive?

Joel Rossman: We are operating in a highly competitive environment and our strength lies in our dependability. We have a customer base of almost 2 million and employ more than 3,000 salespeople. We have the largest transportation system in the world. Our capital expenditures are about $2.4 billion a year. More than half of that is invested in new technology. For example, the automated tracking system is a great sales tool. Another great asset is our driver loyalty. UPS drivers earn great respect in the industry; they are an integral part of our sales force, especially in the small market.

What major changes do your salespeople face at Mark IV Industries?

Bruce McNiel: We are in a transition phase where we begin to empower our sales team with more responsibility and authority. We are transforming our salespeople into business managers for their territories. This means that we are asking for a much broader set of skills such as business management skills. We want our salespeople to be able to read a balance sheet and take on P&L responsibilities. In addition, we want our salespeople to be the voice of the customer within our organization. The underlying objective is to be more customer-driven.

In addition, we are moving from selling products to selling systems. This is probably one of the toughest challenges we face as an organization. We are moving from a central organization to decentralized profit centers. Since we are moving into new market segments, our salespeople need to expand their industry and market knowledge. This is a major challenge that requires a different mindset.

How do you keep up the excitement and motivation?

Bruce McNiel: Change is not always fun. It is important for our managers to be very supportive. They need to spend more time listening to our people, to encourage them and to help them solve their problems. Those who want to stay in the old groove eventually leave. Those who are really motivated begin to see a much broader opportunity for themselves. They enjoy the greater responsibility, take on larger challenges and benefit from greater rewards. I see people moving into higher positions in the future because they have a much broader-based business experience.

How do your salespeople respond to change at Zellerbach?

Tom Weisenbach: In the past, we were very effective order takers and the transaction was driven based on price and availability. We have moved to a different process where we deliver a more comprehensive service and more long-term solutions to our customers. There is a big difference between selling products compared to selling solutions. This change is not easy for us. We motivate our salespeople by sharing best practices and encourage them to focus on the greater opportunity for everybody.

We now ask our salespeople to call on higher-level decision makers and impact different people within our accounts. Instead of focusing on a single transaction, let’s say fifty cents per hundredweight, we can have greater success by looking at the customer’s total business picture. We believe that we can help our customers improve their business operation and control five percent of their total purchases.

It is much more difficult to sit down and go through a call planning process, to listen to customers and understand what their needs are. Of course, recognition and financial incentives are important ingredients to encourage change. We now look at incentive programs to reward salespeople for taking on the new role of a service-oriented salesperson.

Sales force automation

Selling Power: Are your salespeople automated at Boise Cascade Office Products?

Peter Danis: We have about 1,000 salespeople in the United States and about 90 percent are fully automated. The other 10 percent have access to computers, but they choose not to use them. We started testing sales force automation about three years ago, two years ago we computerized about forty percent of the sales force.

Was the initial decision to automate driven by the IS department or by the sales department?

Peter Danis: The decision to automate was made by the marketing department. Our VP of marketing was the driving force of the process. We wanted to be able to respond to our customers faster and better. Initially, about 25 percent of our sales force was doing this on their own; they had their own laptops and developed their own systems. Finally we got to the point where we had to say it’s time to move on to the 21st century. Today, our salespeople love it.

When did you automate salespeople at Brown-Forman?

Jim Bareuther: We purchased laptops for our salespeople about eight years ago. We are now on our third generation of laptops. One hundred percent of our salespeople are using them. We’ve made this mandatory and we continue to invest in new information technology. This enables us to access information and add value.

Joel Rossman: We are just beginning our sales automation journey and I sometimes wonder about the impact of information technology on face-to-face selling. Our salespeople suffer from information overload and I need them out in front of the customer. I believe we need to limit the nonproductive information flow to the sales force.

How does Lucent Technologies deal with this challenge?

Frank Coleman: I think that we should keep in mind that sales force automation is about creating a competitive advantage. Our salespeople can respond faster to a customer’s request. To avoid information overload, we need to limit the amount of requests that go out to our sales force.

How does GE approach sales force automation?

Victor Mendes: You can’t just simply automate what a salesperson does. You have to find a new synergy and achieve a measurable gain in productivity. Every automation step has to be cost justified. If you look at all your technology investment, at the computers, laptops and software, etc., you need to ask what is this technology replacing? What cost do we take out and what exactly do we gain? Typically you will find an increase in revenues and margin, not just a simple decrease in cost. We started the sales force automation process a while back and we found some bumps in the road. It’s been a very positive learning process. We are now convinced that there is a whole lot more to gain than the risk you take. Standing still is no alternative. You’ve got to get in the game or you’ll have no gain. The sales opportunities are phenomenal. The real advantage of sales force automation comes when you are able to connect everything into an enterprise-wide business system.

How can companies automate without taking away the human dimension or creating information overload?

Mary Committe: First of all, technology is a tool, it is not the be-all or end-all. Companies are trying to create more of a learning environment. In many companies the job functions constantly change. I see technology as a tool that can help you deal with those challenges. The laptop is going to become more of a learning instrument, not just a device for collecting data or sending e-mail.

The laptop can become more of a sales advisory, a sales coaching tool.Great salespeople will always be successful, with or without laptops. Ideally, you want to clone the top performer and help the average salesperson work like the top performer. New technology can help in this area. For example, if a salesperson is working with a bank, the new technology is smart enough to show the salesperson that the company has 10 other banks as clients. The salesperson can see what kind of needs they have, what presentations were used and what sales process was applied to close the sale. The software may also show articles about how banks operate. This technology is more interactive and we will see more of that during the next two years.

I believe that the first-line sales managers will face the biggest challenges because they will have more salespeople under their control. They need to train more people and need to receive more training to help them with their coaching process.

Peter Danis: A salesperson has to be an interesting person to start with. A laptop isn’t going to make you more exciting. I don’t know of a single university where students go out and sell as a part of a laboratory exercise. Our most successful salespeople have that added dimension. Sixty percent of them are women. Our salespeople are caring, they are good at listening, they are interesting people and you would have fun having them over for dinner.

Leadership

Selling Power: How would you define leadership?

Peter Danis: Good leaders can take an organization to a place that they would otherwise not have gone.

Duane Miller: First of all, good leaders give clear direction. They have a vision and also have a mission. The best leaders are often good salespeople.

What form of leadership produces the best results?

Rick Buyens: I think that good leaders have the ability to create a new vision. They communicate that vision throughout the organization, help people understand it and motivate them to work toward that shared vision. Ethics and personal values are very important characteristics of good leaders. Another important factor is the corporate culture.

We are in a business world where complexity has increased tremendously. There is no leader smart enough in any of our companies who can understand the complexity of the marketplace in order to set a single strategy that can be implemented throughout our organizations. The challenge for leaders is to create a set of loose principles to tap into the creative energy of every individual in the corporation. We need to allow people to create change and make their environment successful, yet we need boundaries, and we need to achieve ambitious goals. Managers need to encourage people to learn, stretch and grow. We need to create learning organizations that use the full skills and brainpower of all individuals.

How do you create a world-class sales team at IBM?

Richard Harrison: We want our sales force to be viewed as a solution provider. We built a responsive team that focuses on relationships as well as product excellence. Our salespeople benefit from many specialized resources. We try to aggregate the right resources to meet customer needs.

The job of an IBM salesperson is to represent the entire IBM organization to the customer. We follow what we call a customer relationship management process where we organize a team around that opportunity. The computerized opportunity management system allows us to identify the right experts with the right skills. What is unique about this approach is that the team is driven by the customer’s opportunity and not by some internal organizational need. Our sales team is compensated based on how quickly and how efficiently they achieve customer satisfaction.

How do you manage multiple teams?

Richard Harrison: Our people realize that they are going to be on different teams all the time, reporting to team leaders at different locations. Technology helps us link all these processes. We use Lotus Notes and opportunity management systems where we are all connected in one place. That’s new for us, because we went from multiple divisions, multiple sales forces and multiple information gathering tools to one unified system.

How does Lucent Technologies create a world-class sales team?

Frank Coleman: Our objective is to be recognized by our clients as the ultimate business problem-solving sales team. We use technology aggressively to achieve that goal. We make sure our sales teams have the best product knowledge. They know what problems they can solve best. Our salespeople need to understand what technological evolutions will be available three to five years from now so they can help the customer with today’s problems while keeping an eye on more advanced solutions that will be available in the future.

For a complete copy of the H.R. Chally research report, write 500 Lincoln Park Blvd, Dayton, OH 45429, 0r call 937/299-1255; fax 937/299-0630.