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Sales Management

A Source of Competitive Advantage

By Michael Leimbach, PhD

Executive Summary

Creating effective sales managers has been a long-term problem for many organizations. Promoting highly effective salespeople to the role of sales manager seems to fail as often as it succeeds, and there is little documented evidence of sales managers’ independent contribution to organizational value.

This paper reports on research Wilson Learning has completed regarding the role of sales manager skills in predicting the performance of a company’s sales force. Our research shows a 29% increase in top-line performance due to the skills of sales managers, independent of the skills of their salespeople. This research was done in cooperation with five separate organizations who, like you, share a concern for the impact and effectiveness of sales managers.

Sales as a Source of Competitive Advantage?

It is an all-too-common story. A top-flight salesperson is promoted to sales manager, but the organization soon discovers that the skills and perspectives that made this person a top salesperson are not contributing to this person’s success as a sales manager and may, in fact, be preventing this person’s success.

In our experience, the failure to make this transition from effective salesperson to effective sales manager is in part due to some critical situational differences. As the following chart shows, the environment in which salespeople tend to thrive is vastly different from the environment of a sales manager.

 

As a result, many sales managers fall back on old sales behaviors. The common practice of compensating sales managers based solely on their salespeople’s revenue contributes to this tendency. They become “Super Closers” or take a “Heroic Manager” role and start managing client relationships at the first sign of trouble. These behaviors and others can undermine the motivation and credibility of their salespeople. This not only lowers the motivation of their high-potential salespeople, but also makes it more difficult to identify and remove ineffective salespeople. In such a scenario, sales managers don’t add unique value to the organization and may actually take away from their salespeople’s own feelings of value and success, decreasing their satisfaction and connection to the organization.

So, what is the value of sales management to an organization, and how can you quantify the impact sales managers have on organizational performance? Answering these questions was the purpose of this series of studies. From our research, we have concluded that a sales manager’s ability to lead does contribute uniquely to the performance and competitiveness of his or her organization.

Michael Leimbach, PhD

Michael Leimbach, PhD, is a globally recognized expert in instructional design and leadership development. As Vice President of Global Research and Development for Wilson Learning Worldwide Inc., he has worked with numerous Global 1000 organizations in Australia, England, Germany, Japan, South Korea, Taiwan, and throughout the United States. Over more than 30 years, Dr. Leimbach had developed Wilson Learning’s diagnostic, learning, and performance improvement capabilities, published over 100 professional articles, coauthored four books, been Editor-in-Chief for the highly acclaimed ADHR research journal, and is a frequent speaker at national and global conferences. He also serves on the ISO Technical Committee (TC232) on Quality Standards for Learning Service Providers and on the University of Minnesota College of Education and Human Development Dean’s Advisory Board.