Thursday, August 28, 2008

A Friendly Reminder: Salespeople are Knowledge Workers?

Why do I bother you with a seemingly philosophical question at a time where things get tough and you need to stretch yourself more than ever to make your numbers? Because it is about your people. Your most valuable assets. It is through them that you will get the results. But in tough business conditions managers tend to focus on the results and put people second. I hope to make the case that your ability to improve the productivity of your sales teams depends a lot on how you see your people and treat them accordingly.

What is a knowledge Worker?

From “The Definitive Drucker” by Elizabeth Haas Edersheim we learn that the late Peter F. Drucker coined the term “Knowledge Worker” in the late 1950s. This was his term to describe white collar workers whose primary task is interpretation, translation and problem solving; so using gray matter, rather than muscles..

Does this definition apply to Sales People?

Are salespeople not interpreting a customer situation, translate this into a solution based on their offerings and thus solving customer problems? Do we not also recommend to sales people to work smarter by using gray matter, instead of working harder. If we can agree on this, then the next question to ask is:

How do you manage Knowledge Workers?

You don't; you lead them. According to Haas Edersheim, Peter Drucker was a strong advocate that Knowledge Workers should be given autonomy rather than control.They need to be given guidance and perspective. Then one best goes out of their way letting them to asses and direct their own efforts to take responsibility for their results, unless they ask for help. Getting out of the way does though not mean that the Knowledge Worker's autonomous behavior does not needs to be closely monitored. Drucker also gives us some hints what to monitor. Knowledge Workers should not be measured on efficiency but on effectiveness. If we need a definition for those two terms: Efficiency is doing the things right, whereas effectiveness is doing the right things. How this relates to sales is well explained in “Sales Force Performance” by “Andris A Zoltners et al.

Is this the way salespeople are managed?

Chances are high that is not. Over the last years, CRM systems were introduced, forcing people to follow a rigid sales process. These systems are also more focused on measuring efficiency. Activity Management as an example is one of the core elements of CRM systems and it plays into the hands of those who believe that you can only manage what you can measure. I am an engineer by profession and I remember Einstein's quote: “Not everything that can be counted counts and not everything that counts can be counted”. Now this is true for physics but I think it also applies to management.

Is your CRM systems hindering you to treat salespeople as Knowledge Workers?

Not really, if you understand it as an instrument helping you to inspect what you expect. You don't even have to initiate a major technology overhaul for your system to support this philosophy. Some tweaking by a system administrator and some new rules on how to handle the sales process will do the job with most systems.

Sales Management needs an overhaul?

I probably have angered many result oriented command and control managers with what I said. The facts though seem to speak against keeping status quo. If you follow CSO Insights work over the years, not much progress has been made in sales effectiveness. Maybe we should therefore accept that expecting different results from continuing doing the same thing is irrational to put it mildly.

Especially in harsh times with dried up pipelines it is probably better to accept that there are momentarily fewer buyers and to find ways to get more out of what you have. This means focusing on effectiveness instead of thinking about efficiency measures how your people can get more actions into a day. Look at your stars or eagles or whatever else you call your best sales people. Aren't they usually exceeding their quota with fewer opportunities in the pipeline than your average performers.

In his research carried out in the late 1980s, observing sales people involved in major sales, Neil Rackham also did not find a strong correlation between activity and results. . The focus on effectiveness is thus nothing particularly new. So why are we still struggling to accept this? In “Managing Major Sales” Rackham is telling about the harsh reaction he caused by his findings with the sales trainers of the time. Given the number of managers still focusing on measuring activities and other efficiency metrics, I cannot help to think that opponents to Rackham must still be numerous and active spreading the opinion hat “Selling is Selling” irregardless of the context.

To conclude, I would like to recommend to you to consult the post 'The “Blue Collar” Sales Person' by Will Fultz, a fellow Blogger I appreciate very much for his effort giving us first hand views directly from the front line.

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