Sales system approach - manage sales and selling

The Turbocharger
The Newsletter of Delta Institute Switzerland - November 2005

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In this edition …

NEW! Delta Institute offers “packaged consulting toolbox” for professional and in-house consultants

Sales systems approach: systems thinking for sales managers – What it means. How it can make your life easier. What needs to be done.

eMail us - we are looking forward to your comments, ideas, questions, requests

DELTA T-SELLING® CONSULTANTS SCHOOL

DELTA INSTITUTE OFFERS “PACKAGED CONSULTING TOOLBOX” FOR PROFESSIONAL AND IN-HOUSE SALES MANAGEMENT CONSULTANTS

DELTA T-Selling®

DELTA T-Selling® is the first systems approach for leading the key account sales organization. It defines what top sales management must do to lead key account sales as one business system – rather than as processes and tools - to achieve measurable, superior and sustainable sales growth.

Delta Institute is now making DELTA T-Selling® available as a “packaged consulting toolbox” to both professional and “in-house” consultants.

DELTA T-Selling® Consultants School

This is a one week intensive consultant’s workout in which participants learn about and practice DELTA T-Selling®. After having completed the workout participants are:

Authorized to use DELTA T-Selling® in their consulting activities,

Knowledgeable in sales system management and how TOC applies to the key account sales system,

Experienced in the application of DELTA T-Selling® having

Applied DELTA T-Selling® for their client’s or company's key account business themselves,

Arrived at the first decisions to achieve sales growth based on DELTA T-Selling®,

Prepared to guide their clients or companies through the transformation from “classical” sales management into sales systems management on basis of a DELTA T-Selling® Project Plan

Tested and certified as DELTA T-Selling® Project Managers.

A certified program

Today DELTA T-Selling® is part of the Executive MBA Program at the International Management Center in Graz (Austria). As all modules of this program the DELTA T-Selling® course has been certified by FIBAA (Foundation for international business administration accreditation)

Participants

To ensure high professional standards participants must meet the following criteria:

Min. 2 years personal experience in upper sales management (min. District Sales Manager, Key Account Sales Manager, Company Product Sales Manager or above)

And/or min. 2 years experience as sales consultant

Dates? ... 13.-17.2.2006, Valencia (Spain) and 13.-17.3.2006, Geneva (Switzerland).

Register? ... simply send an E-Mail, we will reply with more details

More information? .... you will find on our website –

Questions? ... please send us an e-mail - we will reply with pleasure

SALES SYSTEMS APPROACH: SYSTEM THINKING FOR SALES MANAGERS

WHAT IT MEANS. HOW IT CAN MAKE YOUR LIFE EASIER. WHAT NEEDS TO BE DONE.

In a recent conversation we shared our definition of the “sales system”: “The sales system consists of all processes, policies and management activities that influence how much your company sells”.

Joe (one participant) was angry: “Now you guys have gone crazy”, he shouted. “Are you claiming that everyone should report to the sales manager? You are completely off track!” (Joe, thank you for your remark, which helped us all to clarify many aspects of sales system management in the following discussion).

Why systems thinking for sales managers?

Systems thinking means understanding something as a “whole system” rather than a set of individual elements. In this sense the sales system is “the whole system” that produces the sales of a company.

So far this seems like trivial play with words. How can this view help sales managers to understand their job better, to make their lives easier and to lead their sales organization to sell more at higher productivity?

Sales system management (managing the sales organization based on systems thinking)

Establishes clear enterprise-wide responsibilities for sales success

Makes the sales organization quicker to respond and more flexible

Enables top sales managers to make their unique personal contribution to sales success

Clear enterprise-wide responsibilities for sales success

In “classical sales management view”

“the sales unit” is “the organizational unit of the sales people”.

However, there are many other functions making decisions impacting how much the company sells: Who sets prices? Who decides on the commission scheme? Who sets cost budgets? Who decides on market segmentation? Who decides on how much to spend for advertising?

Not only are these functions classically not seen as “part of sales” – too often there are bitter tensions between these and “the sales people”.

In the framework of systems thinking all these functions

are considered to be part of the “whole sales system” and

within that system must assume responsibility for the impact of their decisions on sales results.

This is why we define the sales system as consisting of all processes, policies and management activities that influence how much your company sells, so it helps to leave behind the classical “silo” view causing so much conflict in many organizations.

Quicker to respond and more flexible

In “classical” sales management

We view sales management as the task to manage the sales organization,

we set sales goals (for fixed time periods, within limitations of cost budgets: the sales organization is mainly seen as a major cost factor),

we then structure the sales organization in units (districts, accounts, etc.), assigning sub-budgets and sub-goals, and

then expect our sales professionals to follow their sales processes to achieve their goals,

leaving it to them to overcome any obstacles they might encounter ("I want to see solutions, not problems!")

However, this “hierarchical” methodology of managing the sales system is rather rigid and struggles to adapt in rapidly changing environments, as the now appear with the rapid spreading of global value networks. Example: in a small sales unit (with small cost budget) an unexpected big opportunity appears which would require shifting of cost budgets – how easy can you do this in “classical” hierarchical sales management?

Very much differing from that approach managing sales as a system means a much more flexible and adaptive:

We set goals for the system based on the opportunities in the environment, adapting them as changes occur there,

We structure the sales system following the opportunities,

We assume responsibility for identifying and resolving the constraints for sales success (because based on systems thinking we realize that these are mostly self made by policies which block the adaptation to changed in the environment).

Sales managers' unique personal contribution to sales success

Classical management works on the assumption that “manager’s job is to set the goals, and subordinate’s job is to reach them”. As one top sales manager stated very openly in a recent conference: “After I have distributed the cost budget and set the sales goals: what is there left for me to do? My people know better than I … their customers, their products, how to sell … How can I personally make a contribution to sales success?”

Systems thinking works from a very different set of assumptions. It demands a unique personal contribution from top management by making it responsible for optimizing company policy as basis for sales success. Three key assumptions in sales systems management are:

Any system’s performance is limited by constraints,

In most sales systems, constraints are caused by inadequate policy,

Therefore it is the unique personal contribution of top sales management to find these constraints and resolve them.

To sum it up

Sales system management requires a different frame of mind than we used to have in “classical” sales management: it requires top sales management to...

Lead sales as an enterprise wide system – and overcome the “classical” piece meal view of organization, processes and I.T.tools,

Acquire profound knowledge about how this system works. Doing this sales management will discover that the sales system if the most dynamic, complex and difficult to manage system in the whole enterprise,

Lead the discovery and resolution of the constraints in the sales system,

And finally lead through the transformation from hierarchically structured, inflexible and slowly reacting “classical” to “sales system” management to ensure the survival of their companies in the new hyper-dynamic world of global value networks.

Happy selling!

Dieter Legat

As always we appreciate your comments, stories, questions. Please, let us know.