At a conference a while back, I sat next to a top executive of a leading medical device manufacturer. There was a break between sessions and we’d both had way too much coffee to just sit quietly. So, we struck up a conversation about our respective businesses.
When this executive learned that I was involved in sales operations research, he offered this suggestion, “You should study my company. Our sales capabilities are world class!” When I asked how he knew that, he very confidently replied, “We’re the market share leader in our category and our earnings have been higher than everyone else’s for nine quarters straight.”
Ah. I see. Time to change the subject. 🙂
I know…I know…I shouldn’t be so snarky. After all, a lot of people think that relative financial performance is an accurate gauge of sales capability. It’s really easy to assume that if you’re generating more revenue and profit, then surely your sales capabilities are superior. Right? Or at least they aren’t inferior. Right?
You could be generating more sales than everyone else…and at higher profit margins….simply because your product designs are superior. Or maybe your supply chain is more efficient. Or maybe your distribution network is much more extensive. Or maybe your advertising is a lot more compelling. Or maybe you were a first-mover in your category and locked-up all the sweet contracts.
On and on, there are literally hundreds of things…things that have little to do with your sales capabilities…that can drive higher overall revenues and profits.
In fact, you can generate comparatively higher revenues and profits despite having inferior sale capabilities! From an overall financial perspective, it can look like you’re doing great…while you’re actually leaving a ton of money on the table due to subpar or nonexistent sales capabilities!
That’s why we’re big fans of capability assessments that focus on the processes and practices that are being utilized, rather than the output. The ideas behind these types of assessments are really straightforward:
- If you’re doing the right things in the right ways—i.e. your processes and practices are good—the odds are extremely high that your work-product is also going to be good.
- On the other hand, if you’re not doing the right things in the right ways, your work-product is most likely subpar, too—no matter what your comparative financials may look like.
With this type of an assessment, you can get a really good read as to how your sales capabilities stack up and where they might be lacking by just answering some simple questions about what you do and how you do it.
Hence, the need to change the subject of that conversation I referenced earlier.
You see, I just knew that if I kept asking questions, I’d end-up informing this gentleman that his company’s sales capabilities were nowhere near world class and that his company was, in all likelihood, leaving a pile of money on the table.
Of course, I wouldn’t have to do that…but I know myself well enough to know that I just couldn’t help it. Thank goodness it was short break!
Assessing Your Sales Operation
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The Sales Capability Self-Assessment
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