Sales training and development can be a little bit like eating your vegetables. Or exercising. You know it’s the right thing to do, but the excuses are so easy and there’s never enough time.
But as 2012 kicks off there’s really no better way for sales organizations to achieve goals than through coaching.
It’s a critical role for sales managers. Despite its importance, however, it’s under-practiced in many organizations. Sales managers don’t coach for one of two reasons; they don’t have the time, or they don’t know how to do it. But balancing out the role between sales and sales management is crucial to allow bandwidth for coaching time, and setting priorities for sales managers is the first step.
Most companies realize how important sales coaching is. In a recent survey conducted by The Sales Leadership Forum, 84% of companies perceive coaching as either “very important” or “one of the most important factors of sales success” for their organizations. But are sales organizations really interested in doing the work? Surprisingly, although sales people often take a cynical view of training, most sales people are open-minded when it comes to coaching and development that contributes to their success. In fact, 75% of sales leaders see their organizations as receptive to coaching.
If coaching and development are important, what are the benefits? Many of these same companies (44%) aren’t clear on the benefits and don’t measure the effectiveness of their sales coaching programs. Of those who do measure the effectiveness of coaching, the top benefits they see from their coaching programs are:
- · an increase in sales productivity per rep
- · an increase in close rates
- · an increase in their ability to cross sell or sell complex solutions or complex products
- · an increase in revenue or profits.
In terms of ROI, about half of companies (48%) report that they get a return greater than their investment in coaching and development, or a return multiples greater than their investment. And an additional 32% of companies at least recover their costs from coaching.
Companies report several challenges in measuring the return on investment in their coaching programs. For example, on the “investment” side of the ROI calculation, coaching in many organizations is conducted informally at the manager level and is not practiced consistently in the field. This makes it difficult to measure the actual resources, both hard and soft dollars, invested in coaching. Also, coaching is often blended with other management roles and not clearly tracked by the organization.
On the “return” side of the ROI calculation, the outcome from coaching is not always clear or near-term. While productivity levels and close rates may appear to be clear metrics for coaching success, those metrics may be driven by other organization and market factors in addition to the coaching program. Improvements in sales capability can develop over time as well. For instance, learning more effective methods for developing the business case and value proposition for strategic accounts may yield results months later when those opportunities naturally present themselves over a long sales process. While the effect of coaching is there, its impact may be latent for some period of time.
How much should a sales manager focus on sales coaching? When we ask managers about how much time they spend on coaching versus other activities in their role, we often get a puzzled look as they think about their range of responsibilities. The fact is spending time on coaching is a challenge for most managers. From the sales executive perspective most leaders (63%) think their sales managers should spend between 30% and 40% of their time on coaching.
But the reality is most sales managers spend less than 20% of their time coaching. That statistic illustrates a gap of about 60% between how much time managers should spend coaching their organizations and how much time they’re actually spending. Such a large disparity may indicate that the message isn’t getting through from executives to managers.
That gap leads to the question of why managers spend so little time actually coaching. One of the biggest challenges we see in both sales management jobs and sales jobs is the time available to focus on their core responsibilities, whether they are selling or sales management. If coaching is a major priority for sales managers, then a premium portion of their time should be dedicated to coaching. That’s not the case. In fact, the top reason companies cite for sales managers not spending more time coaching their teams is they have other management responsibilities that take too much of their time.
A full 70% of companies say that sales managers are held back from coaching because they are too busy with other aspects of their job not always related to sales or sales management. A deeper look reveals that many of these responsibilities are administrative or operational in nature – responsibilities that do not have a direct impact on either revenue growth or development of the team that produces revenue.
Forty-seven percent of companies say that managers are not able to coach because other sales responsibilities take too much time. While more productive than administrative or operations activities, this indicates that many sales managers are actually selling rather than coaching. A clearly defined “selling sales manager” job may indeed have both management and selling responsibilities – a hybrid role used occasionally that is typically not as effective as a true sales manager. This allocation of sales manager time begs the question: What is the role of the sales manager? Is it managing or is it selling? High performing sales organizations understand that they gain a greater revenue impact from managers focused on coaching their teams to sell than from sales managers selling directly.
Time constraints can take another form. Forty percent of companies said that sales managers just do not make the time to effectively coach, meaning they are finding other things to do with their time. Perhaps they are even deliberately avoiding that ominous task.
We know from our research and our work at The Sales Leadership Forum and SalesGlobe that a big part of coaching comes down to the priorities of the organization. About one in seven companies (14%) do not require their sales managers to do any kind of coaching or development. If coaching is not a requirement of the organization, other responsibilities – whether they are selling or administration – will always take the front seat.
Beyond time, the other top barriers are around knowledge and importance. Forty-four percent of companies said managers do not know how to coach effectively. Therefore, even if they are given the time they do not know what to do with that time. Another 19% said they do not have a methodology for managers to use when they have time to coach.
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