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Are You Getting the Most From Your Salespeople?
You can achieve breakthrough sales results by better utilizing one of your company’s most valuable assets — your salespeople

If you’re like most manufacturers and distributors, your salespeople are constantly pressed for time. There never seem to be enough hours in the day for everything that needs to be done.

On the surface it may appear that your sales force is producing satisfactory results, but do you ever wonder if they could do better? Given how hard they’re working, is it possible to get even more productivity without pushing them to the brink?

Our research shows that manufacturers and distributors can greatly increase sales volume and profitability without working their salespeople harder and without adding more salespeople.

The key is to better utilize the salespeople you currently have.

Beyond "time management"

To get more out of an already packed schedule, many firms turn to time management tools and technology. They assume that if they can get their salespeople to use their time more effectively, productivity will improve.

However, our ongoing e-survey "What Consumes Your Time?" shows that salespeople are often bogged down by company policies and methods of work that have outlived their usefulness. Salespeople wage an uphill battle, fighting time constraints created by the very companies whose products they are trying to sell.

When this happens, you have an asset utilization problem, not an individual time management problem. Under these conditions, even the most heroic efforts by salespeople can only incrementally improve sales volume.

To achieve breakthrough sales results, companies must identify and reduce or eliminate the constraints that hold their salespeople back.

Salespeople: one of your most valuable (and underutilized) assets

Manufacturers and distributors agree that salespeople are among their most valuable assets. The phrase "People are our greatest asset" has become a common mantra throughout the business world.

But while manufacturers and distributors do an excellent job utilizing physical assets such as plants, equipment and inventory, they’re not nearly as effective at utilizing one of their greatest assets, their salespeople.

The result: Most salespeople are underutilized and not achieving their potential.

Productivity only tells part of the story

Companies typically measure sales force performance in terms of productivity — the difference between cost per person (input) and sales per person (output). While productivity is important, it only tells part of the story.

In fact, productivity numbers can create a false sense of security by masking ineffective utilization.

Your sales numbers might look good, but could your salespeople be doing even better? Unfortunately, simple productivity measurements can’t answer that question.

How well is your sales force utilized?

To help a sales force reach its full potential, manufacturers and distributors must look at asset utilization.

Asset utilization is traditionally associated with tangible assets, such as plants and equipment. It measures what an asset is currently producing compared to what it is capable of producing.

For example, a manufacturer may calculate the optimal capacity (e.g., tons per day) of a plant and compare it to actual output.

The difference between these two numbers is referred to as the opportunity gap. By increasing the utilization of this asset, management can close this gap and improve both productivity and profitability.

Our research shows that the opportunity gap looms large in the sales world. Most salespeople are underutilized. And management usually has no way to even know it.

Getting the most from your salespeople

Established benchmarks give us a good measure of the optimal utilization for a salesperson. Research shows that peak sales performers spend a minimum of 80 percent of their time engaged in a specific set of revenue-generating activities. They spend the remainder of their time on activities necessary for the day-to-day operation and management of a sales territory.

Our preliminary research shows that the average salesperson only spends 40 percent to 50 percent of his or her time on revenue-generating activities — well below optimal utilization.

Time is truly a salesperson’s most valuable asset. But time-management training, or the latest "time-saving" communication technology, is not always the answer.

Freeing up their time

Time-management approaches assume that salespeople have control over their own time. But without even being aware of it, manufacturers and distributors continue to support policies and methods of work that drain valuable time from their salespeople.

Companies succeed when they identify and eliminate activities that hold back sales force productivity. This frees up salespeople to focus on what’s important: acquiring and retaining customers.

Making it happen

Improving the utilization of your salespeople will help you increase sales volume and profitability. It can also give you a significant competitive edge in the marketplace.

When you look at sales force utilization throughout your sales/distribution channel, you can achieve breakthrough results.

The Industrial Performance Group can help you make this happen. We can help manufacturers and distributors improve the utilization of one of their most valuable assets, their salespeople.

For additional information on getting breakthrough sales results, call 800-867-2778.

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