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In a previous post I discussed how sales roles were divided between hunters and farmers.  During my first 12 months at Pulsant I have had the opportunity to grow, develop and restructure a new business sales team and am still grappling with the hunter or farmer conundrum.  My view 12 months ago about hunters and farmers was that you could simply put a couple of hunters into existing accounts and bingo, problem solved, existing account revenue would just increase.

12 months on and my views have altered.  My new business team has been extremely successful and I know that if I feed them an appropriate amount of leads and opportunities they will continue to find success, but is that the best thing for the customer?  Isn’t the best result for the customer to have a continued interaction with an externally facing individual with whom they have built a deep and lasting relationship?  An individual who understands their challenges, both at the personal level and at the corporate level.  The new business passing a recently implemented customer to account management approach can’t support that so how do we manage it?

One idea is to develop a continuously evolving sales organisation where sales people slowly move along the new business to account manager continuum, acquiring new accounts and retaining them through the customer’s lifecycle.  In the traditional role, the new business team will support the new customer right up to and including implementation process and then pass the baton to the account management team.  The account management team then have the challenge of building relationships from scratch.  As the customer reaches what is often the first hurdle in a new relationship, the implementation, we are advocating changing account owner.

So why shouldn’t the new business team the sales process through to, and after, implementation?  Well that introduces some significant challenges.  Challenges as a manager of a new business team I have not had to worry about before.  So to my idea of the continuously evolving sales organisation (supported by service management).

At no time do I believe the customer should be left alone to manage themselves, but then also why should investment be made in a sales organisation that is not revenue generating.  A sales organisation that looks after invoice queries, sits in the office and worries about tickets and other day to day noise.  I want my sales force to be hunting down new business in the organisation to which we have just sold.  One answer could be to introduce a service management organisation that looks after the day to day stuff, managing the client and making sure they are happy.  Freeing up the sales organisation to go hunting for new business in the existing accounts.

This is where the continuum of sales organisation starts to take shape (and note I have yet to follow this up with how to manage the ongoing issue of compensation, which will be a later blog).  Let’s suppose I have a multi –function, hunter/farmer sales person join my team.  They start off as purely new business as have not yet earned the right to manage a customer.  They sell to the customer, build up a strong relationship and then go hunting within that organisation.  Why would I remove them from that account?  They have the relationship and the knowledge. The problem I am faced with now is that I have a sales person who is part new business and part account management.  They go on to sell some more new business, see that customer through to the next stages and take on another new customer.  And so it goes on until the sales person moves along the sales continuum from new business to account management and ends up just selling into owned accounts as they have no bandwidth to sell to new accounts.

This leads to some significant challenges:

  • Can my sales team account manage (well they are not really account managing if service management is dealing with the day to day process of running the account)
  • Can my new business team recognise they need to look after accounts, is it in their skill set? (Although they aren’t managing them if service management are).
  • Do my account management team invest further in building relationships (yes of course they do because they are now out and selling rather than dealing with the day to day hassles of managing the account).

And so we have the modern day sales team (with some as yet unsolved compensation challenges).  I need my sales people to be filled up with accounts and account related tasks that lead to selling, I would like my service management team to be sorting out the day to day stuff that goes on in those accounts. As the sales person fills up their time with hunting in existing accounts after having brought them on as new business, they transition to only selling into existing accounts as they have no bandwidth to sell to new business.  At that point we need to work out if they stay as they are, driving revenue from existing accounts, or do we transition them back to the start of the process, make them purely new business and let them fill their pipeline up again.

Some statistics to justify the additional account management focus:

  • 80% of future revenue will come from just 20% of your existing clients – Gartner Group
  • It’s 50% easier to sell to existing clients than to new clients – Marketing Metrics
  • Existing clients convert at 60-70% compared to new prospects at 5-20% – Marketing Metrics
  • Repeat clients spend 33% more compared to new clients –
  • Boosting client retention by 5% can raise profits by 75% – Bain and Company
  • A 10% rise in customer retention yields a 30% increase in the value of the company – Bain and Company

There is a real opportunity to build a sales organisation that lives and breathes the account from inception through to the end of their time as a customer.  It may be we can’t pigeon hole mature sales people at one end of the continuum or the other but the new generation of sales people coming thorough need to be able to support new business as well as account management.  That way they will be able to support the new breed of sales person and the new sales organisation.

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