In this day and age where technology and internet have changed the role and responsibilities in the sales department, it is critical for business owners to know where their sales managers are spending their time and resources.
Over the last five years, we have seen a dramatic shift in sales which is mainly driven by the fact that customers are now well-equipped with tools necessary to make an informed purchase decisions, which has significantly changed the way sales reps do their jobs. But despite the changes that this trend has made in the tactical level of sales, it seems that many business owners have not prepared their sales managers enough to meet the demands of the new sales team dynamic.
Sales Manager vs. Sales Coach
Data from Ohio University’s Dr. Adam Rapp shows interesting statistics about the typical day of a sales manager:
– 32% of a sales manager’s time is spent on managing people.
– 26% of a sales manager’s time is spent on managing information.
– 23% of a sales manager’s time is spent on customer interaction.
– 15% of a sales manager’s time is spent on administrative tasks.
– 4% of a sales manager’s time is spent on control (eating lunch, etc.).
What we can derive from this data is that most sales managers still spend so much of their time on reporting, monitoring reps activity, assisting reps in keeping customers engaged, and sharing information to the marketing department.
But in this new age, CRM systems are widely deployed, and marketing automation is assisting reps in the early prospecting stage. Such tools are so practical that in some businesses, sales people do not go near a lead until marketing hands it over with a qualification score.
The same impact of automation is also evident in other traditional tasks of sales managers such as monitoring sales reps activities and managing administrative tasks such as keeping track of how many meetings and client calls are made.
So where does that leave sales manager in a business whose sales team depends on a reliable CRM and has a marketing team that creates highly-qualified leads?
While some people would think that the role of a sales manager is no longer required for a business to survive, we think that the role of sales manager has shifted from manager to coach.
The next set of data comes from a study by Vantage Point Partner Michelle Vazzana. She worked with a group of global B2B sales forces, including 515 sales managers and 4,691 salespeople.
– The bottom 25% of sales managers were performing at 76% of their target.
– The middle 50% of sales managers were performing at 99% of their target.
– The top 25% of sales managers were performing at 115% of their target.
According to the research, top-performing sales managers achieve 39% more of their target than bottom-performing managers. Apparently, this gap can be attributed to the activities that top-performing sales managers do that bottom-performing sales managers don’t do.
That same study also looked at the percentage of reps achieving quota:
– The bottom 25% of sales managers had 47% of reps achieving
– The middle 50% of sales managers had 48% of reps achieving quota.
– The top 25% of sales managers had 65% of reps achieving quota.
As you can see, while the middle 50% of sales managers hit 99% of their target, only 48% of their sales reps were hitting quota.
What all these statistics mean, is that top-performing sales managers are able to achieve their target, not because all of their reps are hitting quota, but because they only have one or two sales reps that are successfully hitting their quota, or perhaps the sales managers themselves are filling the gap by making their own sales.
While this seems just fine for your business’ bottom line, it can hurt your sales organization in the long run because it means that your sales manager could be out in the field selling themselves, racking up extra revenue as player-manager and not as coaches. This also means that your sales operation is not sustainable since you are not able to fully utilize all your sales reps’ skills and knowledge to grow your business.
What Your Sales Manager Should Be Doing?
All told, instead of acting as the sixth man of your sales team, your sales manager should act as the coach of the team.
Remember, a truly productive and effective sales manager is not measured by output produced by the few sales rock stars of the team, or by the massive sales deal they are able to win and close by themselves. Rather, they are measured by the performance of the entire team, and therefore must be able to elevate the capability of every salesperson they are in charge of.
As you can see from the statistics above, the top 25% of sales managers drive more consistent performance in their sales teams. This is a better performance than overall quota attainment because these managers help all of their reps do their very best in their roles.
Other research from Sales Management Association supports the idea that in order to run a successful sales team, a business owner must first invest in training their sales managers:
– Companies who allocate less than 25% of overall sales training budget toward management training perform at or around their goal.
– Companies who allocate 25-50% of overall sales training budget toward management training outperform their goal by 6%.
– Companies who allocate more than 50% of overall sales training budget toward management training outperform their goal by 15%.
These statistics should have helped you know by now what your sales manager should be doing. However, if you want to make a real impact on your business’ profits, then you should have your sales managers undergo a sales training and management program.