Sales Organization Strategies

Sales Organization Strategies It was 3000 BC. Tribal club seller Og ran into stone knife salesperson Ur down at the local watering hole. After the mandatory exchange of grunts and dinosaur claws, talk turned to the best way to set up a sales group. Five thousand years later, CEOs are still debating. Everyone has an opinion, very few people get to start off with a clean slate, and often things "just happen" rather than result as part of a long term strategy.

Companies struggle with the right strategy for their sales department. The internet, cell phones, instant connectivity, and massive blasts of technology change the landscape - yet, the strong personalities within the sales organization resist change or (at best) put their own personal spin on the issue.

Let's explore the pluses and minuses of the most common of business-to-business sales organizations. Warning - consultants are famous for providing just the right answer, but in this equation "one size does not fit all". The answer lies in understanding your position and migrating to the best future.

For the next four minutes - let's assume there are six sales organizational strategies:

Geography based
Technology or industry segmentation based
Sales built around individual skills
Account assignment driven territories
Hybrid Organizations with Specialists
Matrix sales organization

Geography based We all know the story of the traveling salesman - armed with an order book, pencil, and a pair of freshly shined shoes - these guys worked a territorial route. (If it's Tuesday, this must be Pittsburg.) Last week, a new salesperson shared, "My dad worked a territory. And, I am proud to say, I was the first woman in our company to be given a territory of her own."

Pluses She felt good because in her mind - she owned something. Ownership is a key strength of a geography based organization. A new business opens and there is no question as to who should begin prospecting. Referrals flow more naturally. Travel can be minimized (with the right planning). If distribution or reps are used - territories are a natural extension of the planning process.

Minuses Not all territories are created equal and this creates issues with metrics of sales people and relative skills. Personality issues or conflicts between key customers and sales people fester over time. Managers face issues "Gerrymandering" of sales territories and border squabbles between sales people.

Technology / industry segmentation basedDomain knowledge developed as a buzz word in the later 1990's. Sales organizations who pursue value-add or consultative sales strategies find industry based selling to be a natural consideration. The salesperson targets in on a single industry or technology segment - they become part of the industry, attend association meetings, and subscribe to the trade publications of their segment - they speak the jargon of their chosen industry. In short they become their customer (almost).

Pluses Industry segmentation in the sales force provides a vehicle for matching product knowledge to customer base. Market segmentation allows customer-centric tuning of the entire sales process; sales person skills, customer support structure, marketing style, and value proposition adapt to the buying preferences of each segment. Because communications and prospect definition is easier, companies with strong marketing organizations love segmentation.

Minuses Travel and logistics overlap add to the inherent costs of an industry segmentation approach. Sales Managers find it difficult to balance out sales responsibilities in small sales teams. Shifting accounts to even work load or cover in case of health or injury issues grows more difficult. Expansion plans may require multiple paths of thought.

Organized by skill factor Hunters and farmers - my first boss broke sales people into two categories. Hunters found accounts easily. Breaking down barriers, kicking the competition, cold calling, and turning a chance meeting into new business was their life - they lived for "the thrill of the hunt". Once established in the account; they lost interest and their performance began to wane. Farmers feel uncomfortable with new people - they almost never find a new account. But once in an account, they provided customer service like there was "no tomorrow". They "farmed" the account for every available dollar. The Hunter-Farmer strategy is but one of many that use human skill factor to grow business - the best of each of these involves careful consideration of unique talents by a very perceptive sales manager.

Pluses Skill factor based organizations get strong grades for maximizing the impact of a team. Companies who orient on individual strengths tend to be more progressive in other areas of their management style. The Gallup Organization interviewed 80,000 managers in creating the book "First, Break all the Rules" - their findings provide additional insight to other valued derived from this management style (i.e. decreased turnover, happier employees, and long term skill growth).

Minuses Only an experienced and skilled manager can discover and capitalize on the individual skill sets of a diverse team. Organizations scattered over multiple locations may find it difficult to "drill into" the specific and individual strengths of a large number of sales people.

Account assignment driven Convenience rather than a strategy; experts argue this is the strategy of no-strategy. It works this way - since I want you to call on John Deere in Illinois and Iowa - I am going to give you everything else in the Midwest.

Pluses This provides for coverage in a pinch.

Minuses Rarely do the "cover the rest too" accounts grow to their potential.

Hybrid territory mixes - with Specialists Companies pressed between the challenges of developing marketshare over a large geography and providing domain skills to advanced customers are moving to this model. This strategy combines geography with segmentation via specialists. Specialists provide the marketing attention and domain knowledge while geography based sales people handle relationships and logistics. Industrial distribution (Electrical, Power Transmission, Fluid Power, Pipe Valve and Fittings, and Mill Supply Distributors) has moved increasingly to this model. Technology based companies - Microsoft, Dell, Cisco, and others have incorporated Specialists over the top of a geography based sales force.

Pluses Multiple relationships back to the selling company - Buck Rodgers in his book "The IBM Way" first described the value of multiple connections to the customer's organization. Specialists "over the top of" territory based sales people provide a great mix.

Minuses When people work together on the same task, roles must be well defined and orchestrated. The plain truth is very few organizations take the time to define their sales process. Issues with compensation, commission squabbles, and inconsistent coverage drive dissatisfaction with this process.

Matrix sales organization Imagine multiple sales organizations working the same territory. Each has its own organizational structure, goals, objectives, and measures of success - yet they work together. Capitol equipment sales and MRO products sold from the same company come to mind as a place for matrix sales.

Pluses A matrix organization allows use of individual sales talents and provides (to a limited extent) the power of segmentation. Many larger companies have no option but to establish a matrix organization.

Minuses Duplicate management teams and duplicate sales logistics most notably come to mind. Without planning and a long term strategy this organization can become a management tar baby.

Which should we use? This article was not developed to provide you with a road map to selecting sales organizations - instead, it was developed to kick off your own thought process.

Colonel John Boyd, the father of American Air-Fighter Strategy, developed a strategy called the OODA loop - Observe, Orient, Decide, and Act (then repeat the process). You observe your sales team daily. Hopefully with this article you will be able to Orient yourself to the other strategies that surround you. Decide - is there a better way? What are the pluses and minuses to your organization? Act - plan a strategy.

A parting thought Sales people are a strange lot. I know - I have earned my keep in a selling capacity since I was just a boy. I don't believe in stereotypes but most sales people by nature fear changes in structure. Think change by process - not change by decree. I favor migration paths that move culture and people over the course of several years. Define North Star direction, bring in training and trainers and share articles demonstrating your objective. In short, create your change from the bottom up.

Frank Hurtte (frankehurtte@riverheightsconsulting.com) is a consultant to distribution, the sales channel, and manufacture?s agents at River Heights Consulting. He has 28 years of real world experience and is available as a speaker and executive coach. He has written a number of articles and white papers on management, distribution, and the selling process. Frank has helped a number of businesses and not-for-profit corporations through the strategic planning process. You can contact Frank at 563-514-1104 or through http://www.riverheightsconsulting.com

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How to Hold a Fundraising Yard Sale to Raise Money for Your Nonprofit Organization

Are you looking for fundraising ideas for your nonprofit club, organization, school, or team? How about holding a yard sale?

Garage Sales, tag sales, rummage sales, yard sales. Whatever you call them in your part of the country, we've all been to them, and we all know that people love to find a bargain at a garage sale. Some nonprofit organizations hold a yearly "spring cleaning" garage sale. Or, your club could also hold a sale twice a year, one in the spring and then again in the fall. Members of your organization can save things all year long and accumulate lots of items to donate to the cause. Most members are usually very happy to get rid of their unneeded items.

Anyone who has ever conducted a garage sale knows that they require a lot of planning and labor but the rewards can be substantial. Your club should plan for it well in advance and allow about a month to gather all the donations and prepare for the sale.

Tips for a successful Fundraising Garage Sale

Before the Sale

Check with your city to find out if you need to have a permit to hold a garage sale. Ask if there are regulations concerning when and where you can place signs to advertise your garage sale. For example, some cities forbid placing signs on light poles.Announce the sale to the group. Tell them when and where it will be held and when and where to drop off donations. Decide on whether items will be priced by the person donating them or by the organiizers. Designate a person in charge of receiving the donations and choose a place to store the donations

Advertising - Plan your advertising well in advance in order to put classified ads in your local newspapers. Send press releases to your local newspaper and radio stations. Place flyers in public places such as grocery stores, libraries, bookstores, schools, and churches. The night before the sale place posters and signs on the street advertising your sale. Make sure you take down your signs and posters after the sale.Contingency Plans - It's best to plan to hold the sale in any kind of weather. Try to hold the sale indoors or under tarps. You will have placed advertising and engaged the services of your volunteers for a specific day. If you have to cancel your sale because of weather you will have lost your advertising and your volunteers may not be available for a later date.

Pricing garage sale items - Pricing should be in round numbers. This will make pricing and selling much easier. You can buy pre-made pricing stickers at office supply stores or make your own on a printer. Generally speaking, items in good shape should be priced at one-third of their retail price. Of course there will be expections. For example, you might want to price hard cover books at $2.00 a piece no matter what the retail price was. Or, you may want to price CD's, DVD's, and tapes at $2.00 each. You should group like items together during the sale and sell them all for the same price unless otherwise marked.

Supplies needed - Tables, chairs, umbrellas, extension cords, clothes racks, boxes, plastic bags.

The Day of the Sale

Have as many volunteers on hand as possible. You will need people to help shoppers and keep things running smoothly. You'll need people to take the money and provide security. You may want to offer to deliver items if your group has access to a willing person with a truck. Be aware that you will have "early birds" show up so try to be ready to sell up to one hour ahead of your advertised start time. In order to bring in drive-by traffic you can have volunteers hold up signs on nearby streets

Have a check-out table with chairs so that your volunteers can sit. At the table have plastic bags, boxes, scissors, a yard stick, measuring tape, and wrapping supplies such as newspapers. and tape Make sure that you have access to electricity so shoppers can test items. Display valuable items such as jewelry at the check-out table in order keep them from being stolen. You can use a cash box or fanny pack to hold the money. A fanny pack is recommended for security purposes. Make sure your money is never left unguarded. Have plenty of change in small bills at the beginning and throughout the sale. You will no doubt be receiving lots of twenty dollar bills. Take cash only, unless you are willing to take a check from a person who is known to you.

If the sale is being held at a personal residence take precautions against theft from shoppers. Never allow shoppers into the home and make sure outside items that are not for sale do not get stolen. Pets should be locked up also. As your cash builds up throughout the day take it inside to keep it safe.

Selling Tips to Maximize Your Sales and Raise More Money

Let your shoppers know that your yard sale is a fundraiser. Make sure your signs say what you are raising money for. You may want to make a display board at your check-out table the gives information about your organization and cause. Have your volunteers wear your club's t-shirts or uniforms, if you have them, so shoppers will know who is working at the sale.

Decide in advance if you will bargain on prices. Expect that your shoppers will want to bargain. You may want to tell shoppers that you can't lower prices until the afternoon. Let your shoppers know that your yard sale is a fundraiser and tell them how the money that the sale brings in will be used.

Additional Ways to Make Money During a Yard sale

Have a donation jar at your check-out table to collect donations.

Hold a raffle for a special item. You can display the actual item or a picture of the item you are raffleing. Sell tickets throughout the sale and have the raffle drawing at the end of the sale. Or, sell raffle tickets to a raffle that is ending at a later date.

Sell baked goods, hamburgers, hot dogs, chips, sodas, coffee, tea, bottled water, candy, etc.

Sell products your organization has produced such as cookbooks, calendars, CD's, shirts or other spirit items.

Sell fundraising products such as cookie dough, candy bars, wrapping paper and more. There is a wide variety of items available from fundraising companies that nonprofit clubs and organizations can sell to raise money.

In addition to raising money, yard sales are a good way to raise raising awareness for your cause and nonprofit organization. Who knows, you might even recruit some new members during your yard sale.

Article by Amy Passmore for DIYFundraising.com. DIYFundraising.com has do-it-yourself fundraising ideas for nonprofit organizations, clubs, schools and groups. Visit the the DIY Fundraising Blog and subscribe to our free RSS feeds.

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Growing a Brokerage Sales Organization

Culture and Process First; Then Technology

Independent insurance agents and brokerages are gaining efficiencies with technology. More efficiencies are on the way as vendors and carriers roll out real-time communications.

But with so many processes now automated and keystrokes eliminated, this is an excellent time to re-address the real inherent value of the independent agent. That value is around sales-unless a sale happens, nothing happens.

Efficiency-while continuing to be very important-can't be the end game. The sales must first happen in order for all of the other improvements in brokerage workflows and technology to make a difference.

If a brokerage can't create an effective sales organization, it can't create enough growth to satisfy its insurance carriers. And if it can't create enough growth, the great producers in that firm will leave for greener pastures.

Successful owners of sales-driven organizations use a four-step process for growth and profitability:

1. Infuse the brokerage with a culture of marketing and sales

2. Develop and implement workflows for marketing, selling and processing business

3. Apply proper technology to manage these workflows

4. Hire outstanding talent to leverage that technology

Sustaining an effective sales management process over the long term has traditionally been a major challenge for independent agents and brokerages. This four-step process can enable the brokerage to transcend these traditional difficulties.

Culture

Let's begin with the premise that most agencies simply do not have a sales environment.

When you ask the age-old question to an agent, "If you had to define what you provide best to your customers, what would it be?" The answer is, "We provide really good service."

Most consumers perceive that agents and agencies provide sales and service, while most agents look to sales as a by-product or a given in their agencies.

In the flurry of day-to-day insurance processing work, and responding to customer requests, owners often lose sight of the big picture: the need for proactive client and prospect contact, which results in more sales.

Brokerage mergers, which create new and sometimes unexpected cultural differences, also can impact sales. This issue is not to be taken lightly. A little history reminds us of how it often has played out in the real world.

In the 1950s the typical independent agent placed himself on a street corner in Small Town America and he became Mr. Everything. He became a trusted advisor in the community. He liked to contribute and be involved. He was a smart guy, and insurance was a great product that he really didn't have to sell hard.

Then the brokerage begins to expand. It started out as a one or two-person brokerage and pretty soon it's a 10-horse thing and then a 20-horse thing and decades later it's a much a larger entity.

The lack of sales leadership is not just an issue in larger, merged entities. Every brokerage needs a sales and marketing quarterback. That requires retooling of human skills and creating the right environment, not just new technology tools. There is a lot of difference between being a really good insurance agent and being a really good manager of a sales process.

Some brokerage principals should continue in their current role as a really good insurance agent, and bring in a really good manager for the sales process who helps set up a sales-oriented culture throughout the firm. These are the firms that are positioned to use technology tools to enhance their sales process.

Not too long ago, the typical brokerage sales process was that Monday morning arrived, and the producers would ride out on their horses and sell. It worked well. But times have changed. Agents now have to have a pipeline in the office to produce prospects/customers over a long period of time.

A strong sales culture coming from top management is critical. It's not enough to have good salespersons. A typical independent brokerage can find training on how to hire the right personality and how to turn them into an effective salesperson.

But if you don't have a system behind those salespeople in this day of niche marketing, just having good salespeople knocking on doors from one end of Main Street to another and coming back with a slew of sales leads isn't what the brokerage needs.

What the brokerage needs is the ability to develop a program, for example, on the types of leads or accounts it can bring into the brokerage because it knows the types of business it can place.

This cultural change necessarily results in upheaval in staff responsibilities. Independent agents who routinely take full advantage of new technology face an issue. Yes, you do free up resources with smart technology, but are the people remaining the right ones to handle the sales process? Painful decisions might need to be made.

Establishing and Sustaining an Effective Sales Process

The traditional brokerage entrepreneur can realize a whole new level of achievement if he or she orchestrates the transition of his or her brokerage into a sales organization. They, or someone they bring in, must manage the process. They need to create sales teams.

Agents need technology to ensure the sales manager knows that his or her salespeople are making the necessary contacts. In a best-case scenario, a sales manager would be in place - a coach willing to oversee that process. And sometimes the best producer is the worst one to be the coach.

A salesperson must assist in creating the needed process by providing input as to what needs to be done, along with the steps and strategies. Once you develop a sales strategy and a system, it may be tweaked a little bit as time goes by depending on demographics.

Basically, however, once it is created, the salesperson must be totally removed from implementation. Here's why, the brokerage may want to target the H.S.A. small business market. They want to write every small business owner in their territory. He gets a list of viable small business prospects to target and they develop a system to do that (getting a referral, or direct mail, or seminar marketing, or association marketing). Then an agent for the brokerage is in charge of implementing the system. They send out direct mail and after the first week make phone calls. But after 10 calls and seven appointments they get excited and they are now busy going after those appointments. But in the meantime, they dropped the other part, such as sending out the letters, following up with phone calls - the part that creates those appointments. It's an up-and-down cycle.

Distribution Sales Support

Thus agencies need Distribution Sales Support to assist the brokerage's marketing and sales process and to assure that the brokerage continues to generate an ongoing stream of viable prospects. The responsibilities of this coordination are to:

· Oversee the brokerage's marketing and sales processes

· Track producers to make sure they are making the necessary contacts and seeing to it that the information gets passed on and into the brokerage management system (or sales and marketing system)

· Coordinate mailings (newsletters, cards, promotional items)

· Process returns - keeps mailing info current on brokerage management system

· Update form letters

The Distribution Sales Support breaks down the whole process from the beginning. How do you find and identify prospects or suspects whom you think would be interested? How do you match them with carriers you have? And how do you create a system of contacts to get the foot in the door? That's the marketing process.

The sales process is a system to assure that the detailed proposal is made, that the carriers and their quotes are presented, and that the sale is closed. This department also assures that the proactive services proposed to the customer are in fact delivered on time by the brokerage. Then the brokerage prepares for the first renewal, which means ongoing sales activity to retain the business and to broaden the protection provided where appropriate.

Breaking Down the Process for New Sales

When a prospect is looking for insurance and an agent is looking for prospects to write insurance, they are both looking for information. The prospect is looking for coverage and costs, and the agent is looking at the prospect to qualify him/her through field underwriting and placement. It is all about information.

The marketing process/area of an brokerage should start this flow of information by developing "suspects" and then by distinguishing within this group between suspects - those people and businesses an agent "suspects" may need his/her service - and prospects- those people and businesses that an agent "knows" may need his/her service because an x-date is secured or some other signal is given by the potential customer.

Technology Tools to Strengthen the Sales Process

Technology to support the marketing and sales processes falls into five broad categories:

1. Campaign manager: Software that automates the sales and/or marketing functions to prospects or customers.

2. Submission and proposal manager: Software that tracks where in the process to insurance companies, prospects, and customers the quoting/underwriting is currently.

3. True contact relations manager: Software to account-develop current customers.

After a brokerage writes a piece of the customer's business, it can begin a marketing process to write the rest of the account.

4. Call center technology for a sales campaign: Software (e.g., telephony) and hardware

(e.g., headsets) that allow agencies to contact prospects and update account information while setting appointments for producer follow up.

5. 24/7 service pieces: Software for customer self-services, and customer processing of insurance information by the customer, as well as e-newsletters on the brokerage's website. Other services to customers and prospects are available depending on how expansively a brokerage wants to develop those services.

Once the culture in the agency has evolved so producers stop freelancing based on what they did in the past, then owners can look at technology to support that new sales culture. One key element in a sales-oriented agency is the ability to sustain the process in order to provide consistency over a long period of time, fully leveraging the marketplace opportunity.

Brokerage owners must have Distribution Sales Support with the skills to sustain a sales management culture and sales process over the long term. Agents need a customer relationship management (CRM) system that facilitates prospect/customer contacts on a proactive basis based upon the additional services they have interest in or are candidates for.

Some agencies find their brokerage management systems suitable for handling their sales and marketing activities, while others find using a third party system more efficient and effective.

The first step is for an brokerage to gain a full understanding of the sales and marketing capabilities of its brokerage management system before deciding to go to a third party system to meet its needs. If considering a third party system, it is important to know how well this system integrates with the brokerage's management system. Some agents have been successful using their brokerage management systems to track their sales process and to generate the necessary management reports.

A brokerage management system is used for most marketing efforts. All prospects are keyed into the system. It tracks last contact, form of contact, industry, etc. A variety of reports off the system can be run - all of which help to determine the next step. This needs to be done actively, and then follow up with agents to make sure they have provided the information about their appointments. Without that, the system wouldn't have good information.

Conclusion

The Independent Agency System certainly is competitive. In most sales opportunities, a direct-writing company can't compete successfully against an independent agent and broker who can offer the client an array of products. In both personal and commercial lines, independent agents and brokers usually have the weapons to carry the day.

But first they need to have the sales system to get in front of a steady stream of potential new customers. The direct writers have been successful doing this with the massive advertising, disciplined sales process, and training they have put in place and required of their producers.

As the Independent Agency System inevitably becomes more efficient, greater efficiency should improve productivity by enhancing the manufacturing and sales processes. Without a closed sale, there is no productivity to increase. The sales culture in an agency must have the principals deeply involved. If not, sales will suffer. The owner is the bus driver and carriers can be the fuel for the bus.

Agencies need a solid, effective sales management strategy, and technology will necessarily be a factor in any such strategy. We encourage those with a stake in the Independent Agency System to continue to encourage the development of a sales culture coupled with the implementation of sustainable sales processes which can be managed and enhanced with technology.

Lloyd Lofton, L.U.T.C., C.S.A. has been a licensed insurance agent, agency manager, sales trainer and Training Director of a large mid-west insurance company. He is a coach, trainer and sales consultant. He has published articles in Life Insurance Magazine, Agent Sales Journal, Certified Sales Journal and has spoken at industry related functions such as L.O.M.A. He can be reached at 865-776-7632 for questions, training or to speak.

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