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Why the PSS is Unique |
Case Study
TRAINING NEED, BUT NO
TRAINING BUDGET* A building industry hardware manufacturer recognized the need to enhance the skills of their entire sales force, but business had contracted so dramatically that finding the budget to support a significant training initiative was impossible. Because senior leadership of the company was actively shopping the business to potential buyers, there was no enthusiasm for any investment into the business which were not absolutely necessary or would produce a quick ROI. The sales force was quite frustrated as they realized that the company's leaders were more interested in maintaining financial ratios than investing in their salespeople. At the same time, sales leaders were under increasing pressure to drive short term sales (without incremental short term investment in the business). Sales leaders were determined to spur sales growth no matter what budget limitations were imposed upon them by upper management. Every quarter they held sales regional sales meetings to review performance and plan strategy for the next quarter. They substituted the live meetings with webcasts for one quarter and used the cost savings to fund the first phase of their sales training initiative. Phase 1 - Assessment All sales representatives in the top performing region and the bottom performing region completed the Professional Selling SkillMap (see results below) because they did not have the budget for all sales representatives in the company to complete the assessment. Phase 2 - Group and Individual Analysis The assessment results allowed them to highlight specific strengths of their top performers and well as specific weaknesses of those who were struggling. Not surprisingly, their top performers did not all have the same strengths, and their bottom performers did not all have the same weaknesses. At the individual level, the variance between top and bottom performers was even more dramatic in specific skill categories including prospecting, handling rejection, territory management, self-motivation, handling adversity and sales cycle management. Since these were the skill categories with the greatest difference between high and low performers it was determined that this would be the initial focus of the training initiative. |
been adjusted to protect the identify of the client organization, but all relevant details and facts have been included. |
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Aggregate Group Results Top Region Bottom Region
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Phase 3 - Targeted Training Because their limited budget could not accommodate a professional sales trainer, they leveraged the specific skill sets of several top performers and used them to train others who were weak in those exact same categories. Three top sales representatives were selected to act as "trainers" for other (bottom performing) sales representatives. One scored exceptionally high in the prospecting and handling rejection skill categories, another had exceptional skills in handling adversity and self-motivation, while a third showed strength in territory management and sales cycle management. So these three sales representatives were recruited to deliver training to others whose assessment results showed weakness in those exact same categories. Admittedly, salespeople do not always make the best sales trainers. Even top performing salespeople often make poor trainers. They tend to react impatiently when those they are training struggle with the skills that came so naturally to the top performer. They may have great natural ability but not understand why they are so successful, then struggle to explain and help others duplicate their results. And sometimes their specific techniques and strategies are dependent upon their own unique personality, humor, communication style or thought process, and do not necessarily transfer well to others who don't share these traits. However this organization avoided some of the most common pitfalls associated with using top performing sales representatives as sales trainers by leveraging the PSS Facilitation and Coaching Guide. This resource gave them all the tools they needed - PowerPoints, handouts, facilitator script, exercises, etc. - and helped ensure that the training was practical, effective and focused on transferrable skills. This also reduced the amount of time needed for the top performing salespeople to prepare for the training, which had been one of their concerns. |
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Phase 4 - Reinforcement After initial training delivery, participants were assigned to each complete from two to six e-learning courses, targeting the same skill categories. They also received a weekly email message reinforcing key elements of the training, and their sales managers focused all field coaching attention toward the same skill categories. So a salesperson who had attended workshops on prospecting and handling rejection would complete e-learning courses on those topics, receive weekly email reinforcement messages on the same topics, and interactions with his sales manager would have the exact same focus. |
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Phase 5 - ROI Analysis Three months after this sales training effort was initiated, sales performance had definitely been adjusted, in ways that were expected, and in other ways that were a surprise. Average monthly prospecting activity before training: 120 initial telephone conversations resulting in 16 appointments. Resulting in an average of 1.9 sales with a 5 week selling cycle. Average monthly prospecting activity AFTER training: 172 initial telephone conversations resulting in 52 appointments. Resulting in an average of 4.1 sales with a 4.5 week selling cycle.
Sales closing % for bottom performers decreased from 12% to 8%. Even though the
sales closing percentage decreased slightly, the increased
prospecting activity and decrease in selling cycle time improved the
profitability of bottom performing sales representatives by more
than 100%. Average initial sale = $8,200 Company net profit margin = 8% Average profit from initial sale = $656 Projected annual net profitability per sales representative:
Training Costs The top performing sales representatives who conducted the training and coaching reduced their sales activity during the training period by about 15% and their actual sales results were reduced by 6% so this "cost"( in net profit) should be factored into any in-depth ROI analysis. Training materials (assessments, facilitator guides, audio CDs) and logistics (room rentals, travel expenses, meals, etc.): $46,000 Trainers (payments for conducting training and reduction in net profitability during training period): $42,000 Total cost: $88,000 ROI 3-month profit increase per sales representative: $9,400 Total 3-month profit increase for training group (14) sales representatives: $131,600 3-month ROI: 49% Projected annual profit increase for training group: $526,400 Projected annual ROI: 490%
Additional Case Studies MULTIPLE SALES CHANNELS An organization focused on the high school and college education markets, with separate sales channels for distinct product categories including:
The business had separate management, sales, training and marketing support for each channel even though they were often operating in the same accounts (schools). This created confusion with customers, inefficiency, and new account sales efforts were not integrated, which limited the ability for cross-channel leveraging of resources to gain new business. Read full case study
TRANSITION FROM
"FARMERS" TO "HUNTERS" By the time this issue was addressed many of salespeople had not acquired a new account in years. Their prospecting ability (and motivation) was minimal. Read full case study
RESISTANCE TO TRAINING Non-compete agreements are difficult to enforce in this industry, leaving the company with few options to drive business growth with new product sales. Read full case study
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