How can a CEO ensure a successful sales transformation is achieved in their company?
The words ‘transformation’ or ‘change’ are business acronyms for making improvements to what a part of a company is currently doing. Whether that change is small in how an order is processed or a product ordered, or a major change in the structure and activities of a large group of people. The catalyst for the majority of changes within sales is often about more transparency, increased revenues, and profits. Those types of changes go to the core of who and what the company is and can never be treated with a ‘quick fix’ or partial approach.
The catalyst for most changes within sales is often more transparency, increased revenues, and profits. However, those changes go to the core of the company’s identity and can never be treated with a ‘quick fix’ or partial approach.
When the leadership decides it is time for a change in the sales organisation, whether just a few people or hundreds, a degree of simplicity is considered in the process. Typically, companies attempt to embark on what is referred to as simple change but often find themselves confronted with major change as they fail to take the right steps from the outset or look at the issues deeply enough to identify the real causes.
A great example is being lured to software implementation as the first step of their business requirements, and companies quickly realise the roll-on effects. There are low adoption rates, inconsistent use, outright refusal to use and, in some cases, departures. It has improved over the last ten years, but the engagement rate for most companies is very low, with valueless information being added inconsistently.
Perhaps the most difficult task a business leader faces is establishing the full requirements of a transformation and then successfully leading a complex sales force transformation or change.
Too often, CEOs delegate the change to sales leaders, not realising engagement at the highest levels is required to take the change seriously and achieve a successful sales transformation. The stakes are high, with a huge financial and human capital cost.
Why do transformations fail?
Unfortunately, according to McKinsey, 70% of sales transformations fail. They do not deliver revenue increases or performance improvements. The causes are primarily a lack of leadership skills through change and a lack of understanding of the execution of a successful sales transformation.
Leadership in transformation can be different from leadership in other situations. For a successful sales transformation, you lead people into the unknown, take them through new experiences, and ask them to let go of their comfort zones and things they hold dear to themselves. You may be asking them to be in conflict with their beliefs and their status in who they believe they are to the company. You have the added pressure of customers impacting the change as they also place their traditional demands on sellers.
Another challenge is the leaked announcement. You have started changing the business culture immediately when you announce, or whispers sneak out, that things will be done differently. Without a formal announcement and education about the change, people create their own version of what potentially may happen. Teams will react to how they received the information and what was contained. Out-of-touch management may well spark a revolution within the teams by focusing on issues they do not agree are a priority.
Transformations affect people in many different ways. Only experience in execution provides you with the depth of insight to ensure it stays on track and delivers the required ROI.
Another often underrated impact is that sales leaders from within an organisation are going through enormous change for themselves when asked to lead a transformation internally. As a result, they are being asked to take a different message to the team one that may fly in the face of their previous statements.
They are walking into the unknown, often with little time to learn what lies ahead for them, little alone their teams. They can be affected emotionally by the impact of the change amongst those within the company. They can unknowingly succumb to emotional and sometimes irrational decisions under changing stress.
CEOs need to be prepared to support sales leaders and provide the necessary guidance and communication to guide them through the changes, as they are pivotal to a successful sales transformation.
You need to get a transformation right the first time.
When we review companies, we often find breadcrumbs of attempted change swept under the carpet, and others with damage like an open wound. You are greeted by an atmosphere of traumatised personnel, and change has been winding its way around the business.
I recently met with a company that was contemplating a transformation for the third time and was looking at ways they could ensure success and achieve their outcomes. They told me that the previous attempts had only been minor change processes, and they had experienced some bumpy roads going through those changes. The results were not anywhere near the levels they had expected. They consoled themselves that this was just how it was with change, and a good job had been completed. However, they had collectively agreed that the upside would never be as high as what you consider it will be.
The executive had put together a committee of people to guide the transformation, and those people provided stewardship to everyone involved. Those people were briefed on where the company was heading and what must be achieved. They met regularly to discuss the progress and any issues that needed addressing. They made decisions at those meetings to keep the transformations moving forward. They described the process they had experienced in other companies they worked for, and the results they were getting were in line with their past experiences.
I agreed with them that many change programmes or transformations are conducted this way and that the results they are experiencing are measurable to others applying the same practices. However, I gently entered the subject, and I did not believe they were using best practices for transformations. Their results were inevitable as four cornerstones of transformations were missing in their approach. They are:
Transformation Cornerstone #1. Ensure you have a documented plan of what you need to change, how it needs to be changed, and what the completed standards will be from the change.
Change has many layers and items that must be addressed during the ‘transformation’ process. Often one interrelates with another, and if they are not completed in the right sequence, with the full understanding of what ’cause and effect’ you are dealing with, the transformation will go off track or languish in its first couple of months. Therefore, a well-documented sales improvement review and the execution plan are vital.
Transformation Cornerstone #2. Set realistic timelines for change based on the true capacity of the business and the leadership team. Not all leaders can deliver short-timeline change, which most aspire to do.
Not all companies cope well with change; others have cultures requiring tremendous skill and endurance to transform. Just because people give consensus to the desire to change does not mean they will. You need to understand the companies and the people’s ability to cope with change and find a balance between their skills and market demands. Change must be delivered in under 12 months for success.
Transformation Cornerstone #3. Develop your understanding of the human and cultural change dynamics of change.
People are the organisation. Take them away, and you have no business. Of course, this does not mean you build the entire transformation around people’s demands. Still, it does mean that you must have an element of psychology to understand people’s real motivations for their actions. Cultural change is the most difficult task to achieve when you have an existing relationship with the people as you have already developed a subjective perspective of those individuals, compromising your ability to drive change.
Transformation Cornerstone #4. Build a critical mass of support by engaging key stakeholders.
Key stakeholders are pivotal to your successful sales transformation. One person reneging or attempting to ‘sit it out’ will send a message that creates a crack that grows as wide as the Grand Canyon in your transformation. Key stakeholders must be on board, or new people must be installed who are supportive stakeholders. The company must hear, observe and experience one message continuously.
Successful Sales Transformations
Most companies quickly move past the first cornerstone of planning and certainly underestimate the second of timelines. Hence, the results are the same as those that many companies experience. Interestingly, many companies will trip on cornerstone three by becoming part of the problem rather than the solution. This is overcome by simply having an external person become conscious of the transformation to assist in keeping people focused. The final cornerstone can create challenges for companies that wish to attempt change with their existing team leaders. Often, a decision based on loyalty can corrupt the entire process. Many executives believe they can coerce them into being supporters, and much time is lost. Damage is caused as those stakeholders agree in meetings and conduct themselves in conflict outside the sessions.
If you apply those four cornerstones for transformation, your ROI will increase, and your risk of failure will greatly diminish.
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Sales Focus Advisory specialises in reviewing and developing sales transformation plans to ensure maximum ROI. Contact us today to discuss your specific business goals.
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