As we approach the end of budget season, I’m hearing that the normal corporate mantra of ‘more for less’ is becoming even more acute and businesses are becoming less realistic when building their sales budgets. Many of you may take this assertion as the game play of sales leaders who look to ‘manage’ the budget message and their impending targets, but I believe that, in a lot of cases, there has been a change.
Often, the usual ‘budget bridge’, showing how you plan to progress from one year to the next, is missing and even more scarily, some senior sales leaders don’t seem to have any understanding of how they are going to achieve next year’s result. The stated business position of ‘it is what it is’ and ‘you’ll have to find a way to achieve it’ is becoming more of a norm. It seems budgets are increasingly built and set by the Finance team in conjunction with the Managing Director and with less engagement with the key business stakeholders, especially the sales team.
A lot of the budgetary pressure stems from the world we’re working in today, with huge external economic and market pressures and a level of uncertainty that many haven’t encountered in their career to date. Managing through such a period is challenging to say the least. In addition, many companies are requiring a dramatic improvement in performance versus 2023, often directed by the central organisation, however a lot of cupboards have already been stripped bare and markets are often still depressed. The above is a dangerous combination that needs to be navigated carefully.
From a commercial perspective, sales organisations should be full of people who are driven to achieve the desired result and are hungry for success. The risk with a budget (sales target) that is seen as unrealistic, is that the issues of buy in, engagement and motivation come to the fore. How effective are an unmotivated sales force? The real impact can be a deterioration of sales performance due to a demotivated team, never mind the increased risk of churn of your sales talent (remember it’s always the sales talent that moves first, because they can!).
So, what can a sales leader do to combat this phenomena, especially as the reality may be that the budget itself is an immovable beast that you can no longer influence. Those that know me, know that I have often cited the cliché ‘hope is not a strategy’ and this is a classic example where you must take the future into your own hands.
You may be facing life with a smaller team, a larger target or both, but the truth is that you need to maximise the output of the team that remains. Your role is to enable your team to be the best that they can be, both as individuals and as a collective.
To do this and as a senior sales leader, my belief is that you must invest in your team. This can be done a number of ways, but it must be done.
For me the first port of call is always a bit of self-reflection about the sales leadership, has the business got the skills and competencies needed in this area to carefully navigate the next 12 months, maximising the sales performance. Often it is the sales leaders who state ‘there’s nothing to see here’ who have the most to learn (this is a reflection point in itself). Whether the competencies and sales leadership skills are developed and fine-tuned through coaching or a more formal training and development route, the reality is which sales leader couldn’t benefit from some form of development.
At the same time, the sales team also need to work differently – how else will they reach the increased target per salesperson (remember the definition of insanity)? Whether this change in behaviour and activity is driven by a tailored but broad sales development program, or perhaps it’s a more advanced and deeper dive into certain aspects of the sales process, only one thing is for certain, that positive change needs to happen.
Ultimately any investment of time and money needs to have a return, but think about it – how many additional sales would you need to make, or how many existing customers would you need to retain, or how much of a percentage sales margin improvement do you actually need to gain in order to get the return. A lack of development is also often cited as being one of the reasons why salespeople leave a company and so the increased motivation and retention of your sales team is also a critical factor in helping you make the decision to invest. My experience of over 20 years of senior sales and leadership positions is that the return on investment is repaid in no time at all.
My survival guide to this situation includes the following recommendations:
- Reflect and act on developing your business’ sales management competency and capability
- Understand what your sales team are going to need to do differently
- Invest and upskill your sales team in the areas that will have the biggest impact
- Doing nothing is not an option!
As a senior sales leader, achievement of the budget is your responsibility and now is not the time to reduce the investment in yourself and your team. I passionately believe the opposite to be true, one of your only options to try and achieve that stretching budget is to invest.
Business Linked Teams can help in understanding the challenges that you face and by designing solutions that will add value to your sales organisation. Get in touch today to arrange a call to see how we can help.
Richard Martin, Sales Director