Virtual Sales 3.0 Conference March 20th - 21st 

 

Focuses on aligning people, process & technology through  sales transformation!

 

Why Misalignment Is Silently Killing Your Revenue Acceleration Strategies

By Tristam Brown, CEO, LSA Global
Seven people in suits stand inside of a rectangle that is divided by a blue triangle

The Job of Sales Leaders

We believe that the job of sales leaders is to create and implement revenue acceleration strategies responsible for profitable growth.  We also believe that sales leaders must invest in attracting, developing, engaging, and retaining top sales talent to ensure that sales growth is sustainable.

Unfortunately, the majority of organizations struggle to define and align all the critical factors that would allow them to achieve consistent and highly profitable growth in a way that works for their customers, their employees, and their executive team. Similar to a car that struggles to drive straight forward with a misaligned wheel, it often takes just one misaligned strategy to create unwanted short- and long-term problems.

Sales Alignment Research

Our organizational alignment research at 410 companies across 8 industries found that only 15 percent of companies had high enough levels of alignment to consistently drive profitable revenue growth, customer loyalty, and employee engagement.  Note that we say, “high enough levels” and not “100% alignment.”  The research did not look at perfection, but at a perception that there was enough agreement and commitment to move collectively forward.

Here’s the good news: highly aligned companies grow revenue 58% faster, are 72% more profitable, and satisfy customers 3.2-to-1.  But here’s the bad news: McKinsey found that misaligned companies generate 18% less EBITDA, and IDC reported that weak sales and marketing alignment causes companies to lose at least 10% of their potential revenue growth.

3 Most Common Areas of Misalignment that Hurt Revenue Growth

The most common examples of misalignment responsible for negatively impacting profitable revenue growth were centered in three areas:

1. Misalignment on Strategic Context, Direction, and Priorities

Misalignment typically starts at the top and is often caused by the lack of enough understanding, buy-in, and commitment to go-to-market strategies.

Strategic sales clarity accounts for 31% of the difference between high and low performing sales organizations.  If individuals, teams, and functions are not proactively working together to achieve common sales objectives, the chances of sustainable revenue acceleration are half as likely to occur.

Strategic sales misalignment can take many forms.  We’ve seen Legal and Finance hold up or deprioritize deals in direct conflict with sales objectives.  We’ve seen sales reps in different divisions compete for customer budgets in the same account.  We’ve seen product roadmaps contradict promises made by sales and marketing. And we’ve seen sales and marketing blame each other for a lack of qualified leads.

To get aligned, make sure that you invest the time to create enough understanding and buy-in from key stakeholders regarding:

  • The internal and external market realities that you face
  • Your ideal target client profile where you should win the majority of the time
  • What truly differentiates you from the competition from your buyers’ perspective
  • How success and failure will be measured at the individual, team, and organizational levels
  • The specific 90-day action plan with clear goals, roles, and deliverables

Is your sales strategy truly clear enough, believable enough, and implementable enough to all your key stakeholders to drive revenue growth

2. Misalignment on Sales and Culture

Once your sales strategy is clear enough to drive consistent revenue growth, the next most common area of misalignment that negatively affects revenue acceleration relates to sales culture.  We define sales culture as “how” and “how well” revenue generating work truly gets done on a day-to-day basis.

We define a sales-driven culture as one where the entire organization purposefully focuses on prioritizing how and why sales-related things get done to help customers succeed.  That means that the way people collectively think, behave, and act is first and foremost about helping to attract new target customers and retaining and growing key accounts.  It accounts for 40% of the difference between high and low performing sales organizations.

While a sales-driven culture to grow revenue may seem like a no-brainer, many successful companies are rightfully purpose-, technology-, service-, product-, or people-driven cultures.  One culture driver is not better than the other.  You need to decide what aligns best with your overall strategy and how you want to set yourself apart from the pack.

For example, Patagonia is a successful purpose-driven company where everything they do, from its core values to priorities, puts the Earth first. So much so that they recently decided to have all profits go to a non-profit for environmental purposes.

Zappos is an example of a customer-driven culture striving to attract, impress, and retain customers over everything else.  Their #1 corporate value is to “Deliver WOW Through Service.”  A customer service orientation is what makes them successful.

Apple is an example of a marketing- and product-driven organization.  At Apple, their success is founded upon everyone focusing on the design, features, capabilities, manufacture, and subsequent marketing of its products. All the other departments (e.g., Finance, Legal, Human Resources, etc.) act in service to a successful product.

All three are successful companies with different cultures.  One culture is not inherently preferred over another.  The effectiveness of your culture depends upon your strategy.  In general, sales-driven cultures are healthy enough, high performing enough, and strategically aligned enough to consistently accelerate revenue growth.  The way people think, behave, and act serves the goal of achieving sales objectives in a way that makes sense for the customer and the business.

To create a sales-driven culture, make sure that you:

  • Assess the current levels of cultural health, accountability, and strategic alignment to see where you stand
  • Define the needed culture that is required to get you where you want to go
  • Prioritize the critical few cultural shifts that must occur to set everyone up for success
  • Implement the desired changes at a pace that works for your unique situation

Is your culture healthy enough, high performing enough, and strategically aligned enough to drive consistent and profitable revenue growth?

3. Misalignment on Sales Talent

Too many companies try to solve complex revenue generation problems by either hiring different salespeople or by rolling out business sales training to teach new sales skills.  But we know from over 800 sales training measurement projects that only 1-in-5 sales reps change their behavior and performance from stand-alone sales training.

It is hard for any but the very best salespeople to excel when the sales strategy or sales culture are not aligned enough to create an environment for profitable revenue growth.

Don’t get sidetracked into making sales talent moves (e.g., attracting, developing, engaging, or retaining sales talent) before your sales strategy and culture are primed for sales talent to thrive.  Otherwise, you dilute your investments of time and money.

If you want to attract, develop, engage, and retain top sales talent, make sure that you:

  • Improve sales assessment capabilities to better identify, hire, promote, and develop both sales reps and sales leaders who will thrive in their roles.
  • Invest in sales leadership to ensure that sales leaders and managers can consistently and effectively lead, manage, and coach their sales teams to higher performance.
  • Invest in “money making” sales skills that matter most to your target buyers and consistently coach to and reinforce them.

Are you investing wisely in how you attract, develop, engage, and retain top sales talent?

The Bottom Line

The highest performing sales teams ruthlessly clarify, prioritize, and invest in what matters most to create profitable revenue growth in a way that makes sense to their customers, employees, and the bottom line.  If you are not growing at the pace you would like, it is probably time to adjust your sales strategy, culture, and talent to create higher levels of cohesion and performance.

To learn more about setting the stage for faster revenue acceleration, download 7 Ways to Stress Test Your Sales Strategy.