Lack of sales skills holding back economic growth - Survey
Lack of sales skills holding back economic growth in New Zealand and Australia - Survey
A global evaluation involving more than a million sales people has revealed that meaningful economic growth in New Zealand and Australia is being held back by a lack of sales and sales management skills.
CEO of Australasian sales consultancy SalesStar, Mr Grant Holland, said the Objective Management Group's global sales effectiveness evaluation included hundreds of companies in Australasia, and found that less than half have the necessary skills for growth and half of the potential revenue is being left on the table.
"The results of the study were also reflected in recent seminars we conducted with more than 80 CEOs from Melbourne and Auckland, all of them turning over between $20 to $100 million dollars annually.
"One hundred per cent of the CEOs were confident of growth in the next one to three years, compared to earlier in the year when they were more 'ho hum' in their expectations. However, almost all were less than 40 per cent ready and at least half of them conceded that they do not have the internal sales skills, leadership, systems and processes to make it happen."
Mr Holland said that in SalesStar's experience, companies that up-skilled in business development, and put in place the right systems and processes for growth, recorded growth percentages well above thirty percent within 12 months.
"We're not talking about start-ups but about mature companies that just don't know how to sell in the new environment. A worrying number of companies lack a sales strategy, good leadership and a well-planned and executed sales process.
"Part of the problem is promoting star performers to leadership positions. A common practice in Australasia is for companies to appoint the best sales person to a management position, with no experience, no training and probably no leadership ability.
"The result is that they've exchanged a star performer for an average manager," he said.
Results from the sales effectiveness evaluation revealed that just 24 per cent of sales people globally and only 25 per cent of sales people in Australasia have effective sales closing skills.
In Australasia, 51 percent of sales people can effectively qualify a customer, while globally that number is 53 percent.
"When we looked at the number of sales people and sales managers that have an effective sales process, only three per cent of sales people and four per cent of managers have one in place. This makes it impossible to track progress or to hold people accountable to the right activities that drive growth.
"As a result, only six percent of those in sales positions are presenting quotes and proposals at appropriate times. The result is wasted time, irritated customers and low conversions," he said.
Mr Holland suggested companies take the following steps to ensure they are geared up for growth and sales success:
1. Map out a step-by-step sales process – including key milestones – that mirror the activities and behaviours of your top-performers in the field.
2. Detail your buyer's decision-making journey and include this in your process so that you understand what their needs will be at any given time.
3. Stop worrying about what Customer Relationship Management software you are using. CRM's – like megaphones – are only as good as the information you put through.
4. Pay attention to the data. Learn to interpret conversion ratios and leading indicators.
"Leading indicators are particularly important for accountability," says Mr Holland. "For example, if you know it takes 20 presentations to achieve a sale, then your leading indicator is 'presentations'. This means, you would be well advised to measure your sales person by the number of presentations that they do."
"Develop your coaching skills. Research and experience tells us that coaching is the single most important function for your sales managers and 96 per cent of sales people are coachable. Yet, despite this, sales managers across Australasia have just 44 per cent of the skills to coach effectively and spend little or no time doing it. As a result they will continually struggle to develop A-players in their team.
"Bear in mind, however, that coaching in the right activity at the right time is nearly impossible without a process.
"Ultimately what this means is that significant growth won't happen by accident. Expecting growth and actually achieving it, is the difference between leadership skills and the lack of them," he said.