Harvard Business Review Special Issues Summer 2017

GETTING SALES RIGHT IS much more complex than it used to be. Persuasion is no longer enough. You need creative people and relevant data in the field, supported by an efficient but flexible operation back at home base. And if you manage a sales force, you also must know how to keep your talent engaged and excited. In their article “Motivating Salespeople: What Really Works,” Thomas Steenburgh and Michael Ahearne argue that most companies have their incentives all wrong. One-size-fits-all compensation plans undermine team performance, they say, because salespeople at distinct points on the performance curve—stars, core performers, and laggards—vary in how they respond to different inducements. The authors lay out which programs work best for each segment of your team and offer advice on how to structure incentives accordingly. Sales reps…

IT’S NOT NEWS that the role of salespeople and selling is changing. In the past, salespeople were often the first step in a purchase process and could significantly influence customer decision making by controlling information about pricing, availability, competitive advantage, and so on. But in this era of nearly ubiquitous information, customers usually engage with salespeople after they’ve researched their purchase and, in some cases, made their purchase decision. Digital commerce and disintermediation have caused many customers to question the importance of having a sales relationship at all. Moreover, companies are learning that true sales success isn’t indicated by the number or size of the deals closed; it’s measured by getting and keeping the right customers. Great salespeople succeed in this new business environment by doing what great brands do. In my…

IF YOU ASK an extremely successful salesperson, “What distinguishes you from the average sales rep?” you will probably get a less-than-accurate answer, if any answer at all. Frankly, the person may not even know the real answer because most successful salespeople are simply doing what comes naturally. During the past decade, I have interviewed thousands of top B2B salespeople who sell for some of the world’s leading companies. I’ve also administered personality tests to 1,000 of them. My goal was to measure their five main personality traits (openness, conscientiousness, extraversion, agreeableness, and negative emotionality) to better understand the characteristics that separate them from their peers. The personality tests were given to high-tech and business services salespeople as part of the sales strategy workshops I was conducting. In addition, tests were administered at…

SUCCESS IN a sales force requires having strong talent up and down the organization. A weak salesperson will weaken a sales territory, a bad sales manager will damage his team and dampen results in his region, and a poor sales leader will eventually ruin the entire sales force. It can be difficult to recognize the signs of a poor sales leader and the possible damage that person can do—especially when he appears to do some good early on. Consider two examples. An education technology start-up hired a sales leader who came from a large, well-respected firm. He had extensive market knowledge and a stellar track record. Although good at scaling and operating a sales organization, the leader was unable to succeed in a rapidly changing environment that needed experimentation and nimbleness. The…

ARTIFICIAL INTELLIGENCE (AI) is on quite a run, from Google’s AlphaGo, which earlier last year defeated Go World champion Lee Sedol four games to one, to Amazon’s Echo, the voice-activated digital assistant. The trend is heating up the sales field as well, enabling entirely new ways of selling. Purchasing, for example, is moving to automated bots, with 15% to 20% of total spend already sourced through e-platforms. By 2020 customers will manage 85% of their relationship with an enterprise without interacting with a human. Leading companies are experimenting with what these technologies can do for customers, typically around early-stage transactional processes. For example, AI applications can take over the time-consuming tasks of initiating contact with a sales lead and then qualifying, following up, and sustaining the lead. Amelia, the “cognitive agent” developed…

ALL BUSINESSES face opportunity costs. In the case of a sales organization, money, time, and effort allocated to accounts A and B are resources not available for accounts C, D, and so on. That reality drives the distinction between effectiveness (doing the right things) and efficiency (doing things right) that Peter Drucker and others made years ago. A confusion between efficiency and optimization plagues many sales efforts. In an automobile analogy, sales efficiency (SE) initiatives—such as CRM, training, and KPI dashboards—improve the engine’s horsepower. Sales optimization (SO) decisions—such as aligning sales tasks with business strategy, customer selection, and sales force deployment across opportunities— set the direction in which the car will travel. As the saying goes, “If you don’t know where you’re going, any road will take you there.” But if…