DEVELOPING DEVELOPING EXCEPTIONAL SALES PROFESSIONALS JUNE2013 EXCEPTIONAL SALES PROFESSIONALS

Transcription

1 DEVELOPING DEVELOPING EXCEPTIONAL EXCEPTIONAL SALES PROFESSIONALS SALES PROFESSIONALS JUNE2013

2 Contents Overview 1 Key Findings 2 Sales Training Investment 3 Sales Training Effectiveness 4 Revenue Growth 5 Sales Training Topic Areas 6 Rating Sales Skills 12 Assessing Sales Training Impact 14 Sales Training Sources 15 Best Practices 16 Moving Forward 17 Demographics 18 About this Research 20

3 1 P age Overview Within each corporation the sales force carries a range of responsibilities, but ultimately, each Sales Professional is expected to drive revenue and contribute to company growth. To develop and master the skills essential to their success and the success of their companies Sales Professionals require sales training programs that address the situational business challenges they encounter daily. With approximately 81% of respondents reporting that their sales training programs are effective, why aren t more companies steadily increasing sales and revenue? The goal of this research study is to explore current sales training practices, and highlight the attributes and skills that enable measurable company growth. During the second quarter of 2013, 110 respondents contributed to the study the majority representing Sales and Human Resources departments from a range of industries. This research not only examines the effectiveness of sales training programs and the Sales Professionals they train but it also identifies: With approximately 81% of respondents reporting that their sales training programs are effective, why aren t more companies steadily increasing sales and revenue? Best practices for developing and prioritizing the skills of Sales Professionals Differentiating factors between High Performing and Average Performing organizations Methods organizations currently use to assess the quality and impact of their sales training programs By understanding how High Performing companies develop, deliver and assess their sales training programs, Learning Leaders can better evaluate and improve their own. In doing so, they facilitate the development of the sales force, cultivating them into exceptional Sales Professionals who drive sales and business value.

4 2 P age Key Findings Approximately 81% of respondents believe that their companies sales training programs are very or somewhat effective. When developing sales training programs, respondents cited training on understanding customers business needs as the most important topic area. More than 88% of respondents said their companies currently include training on products and services in their sales training programs. Thirty-nine percent (39%) of respondents rated their Sales Professionals financial acumen as below average or poor, and more than 37% of respondents said their companies plan to include training on financial acumen and ROI in their sales training programs in the future. Respondents rated sales professionals product and service knowledge as excellent or above average most often. High Performers rated their sales professionals as excellent or above average more than twice as often as Average Performers in selling to customer executives, negotiation skills and financial acumen. High Performers assess the quality and impact of their companies sales training programs more often than Average Performers. Approximately 35% of Average Performers do not assess their sales training programs. For both 2012 and 2013, respondents said their companies dedicated, or plan to dedicate, the highest percentage of their sales training investment in product training.

5 3 P age Sales Training Investment To better gauge which areas of sales training garner the greatest investment, respondents were asked to estimate the percentage of their companies sales training investment devoted to five areas: business skills training, product training, sales methodology training, sales skills training and tools training. 1 In 2012, companies allocated approximately 35% of their sales training investment to product training. Figure 1 Business skills training, 14.9% Tools training, 11.0% Product training, 34.5% Sales skills training, 22.1% Percent of Respondents, N=104 Sales methodology training, 17.5% In 2013, companies still plan to invest most in product training, but plan to increase their sales training investment in all other areas. Figure 2 Business skills training, 15.2% Tools training, 12.2% Product training, 29.6% Sales skills training, 23.6% Sales methodology training, 19.4% Percent of Respondents, N=105 1 Each sales training area is defined as follows: business skills training (e.g., understanding customers' business needs, ROI, financial acumen); product training (e.g., new releases, newly acquired products); sales methodology training (i.e., implementing standardized or new processes); sales skills training (e.g., negotiating, presenting, prospecting, questioning); tools training (e.g., technologies, CRM usage, marketing resources).

6 4 P age Sales Training Effectiveness To determine how well companies currently design, develop and deliver sales training, respondents were asked to rate the effectiveness of their companies sales training programs. As seen in Figure 3, approximately 81% of respondents believe that their companies sales training programs are either very effective or somewhat effective. Figure % 60.0% 53.8% 50.0% 40.0% 30.0% 26.9% 20.0% 12.6% 10.0% 6.7% 0.0% Very effective Somewhat effective Somewhat ineffective Percent of Respondents, N=110 Very ineffective

7 5 P age Revenue Growth While effectiveness ratings can offer a broad picture of how well a company provides training for its Sales Professionals, company growth rates can help identify the practices that are actually delivering results. Respondents were asked to estimate their companies revenue change from 2012 to Approximately 46% of respondents categorized their companies revenue change as greater than (>) a 5% decline to greater than or equal to ( ) 5% growth; these are considered Average Performers. Those reporting greater than or equal to ( ) 6% growth are labeled as High Performers. See Figure 4. Figure % 25.0% 20.0% Average Performers, 45.9% 26.2% High Performers, 44.9% 24.3% 20.6% 15.0% 10.0% 7.5% 10.3% 9.3% 5.0% 1.9% 0.0% >5% decline 1% to 5% decline Flat 1% to 5% growth 6% to 10% growth >10% growth Don't know Percent of Respondents, N=107 In order to better understand what higher performing companies are doing differently, the two groups are compared throughout the report, High Performers ( 6% growth) and Average Performers ( 5% growth).

8 6 P age Sales Training Topic Areas CURRENTLY INCLUDE Respondents reported which topic areas their companies currently include or plan to include in their sales training programs. Training on products and services was the most common topic area currently included in sales training programs (Figure 5). Figure 5 Training on products and services Training on sales processes or methodologies Training on specific sales tools and technologies Training on understanding customers' business needs Training on presentation skills 73.1% 68.8% 67.6% 53.2% 88.1% PLAN TO INCLUDE Training on financial acumen and ROI was the most cited topic area that that they plan to include in their sales training programs (Figure 6). Figure 6 Training on negotiation tactics Training on selling to customer executives 45.4% 41.3% Training on financial acumen and ROI 31.8% Percent of respondents whose companies 'currently include,' N= % 20.0% 40.0% 60.0% 80.0% 100.0% Training on financial acumen and ROI Training on selling to customer executives Training on negotiation tactics 37.4% 36.7% 36.1% Training on presentation skills 29.4% Training on understanding customers' business needs 28.7% Training on sales processes or methodologies 25.0% Training on specific sales tools and technologies 23.9% Training on products and services 9.2% Percent of respondents whose companies 'plan to include,' N= % 10.0% 20.0% 30.0% 40.0%

9 7 P age CRITICAL TOPIC AREAS FOR SALES TRAINING When developing sales training programs, companies consider certain topics more critical than others. Respondents were asked to rate the importance their companies place on several topic areas typically included in sales training programs. Figure 7 demonstrates the topics considered most and least important, with training on understanding customers business needs garnering the greatest support. Figure 7 Training on understanding customers' business needs 63.0% Training on products and services 52.3% Training on selling to customer executives Training on sales processes or methodologies Training on presentation skills Training on specific sales tools and technologies Training on negotiation tactics Training on financial acumen and ROI 36.1% 35.8% 31.2% 25.9% 23.9% 16.8% Percent Rating Each as Critical, N= % 20.0% 40.0% 60.0% 80.0%

10 8 P age CRITICAL TOPIC AREAS FOR SALES TRAINING High Performers vs. Average Performers When comparing High and Average Performers, High Performers reported the following sales training topics as critical twice as often as Average Performers: selling to customer executives, tools and technologies, and financial acumen and ROI. Figure 8 Training on understanding customers' business needs Training on selling to customer executives Training on products and services Training on specific sales tools and technologies Training on sales processes or methodologies 16.7% 24.5% 35.4% 35.4% 32.7% 48.9% 45.8% 62.5% 64.6% 63.3% High Performers place more importance on selling to customer executives and financial acumen and ROI training than Average Performers. Training on presentation skills Training on financial acumen and ROI 10.6% 22.9% 33.3% 32.7% Training on negotiation tactics High Performers, N=48 Average Performers, N= % 26.5% 0.0% 20.0% 40.0% 60.0% 80.0%

11 9 P age CRITICAL TOPIC AREAS FOR SALES TRAINING Critical for All Sales Roles When developing sales training programs, there are often certain skill sets or topic areas that are necessary for certain roles. Respondents were asked to clarify which topic areas are critical for all Sales roles, Sales Management, Senior Sales roles and Inside Sales roles. Figure 9, below, shows the topic areas considered most critical for all Sales roles, with training on products and services, training on understanding customers business needs, and training on sales processes and methodologies representing the top three. This not only reflects that most corporations expect sales professionals to know what they re selling, but also why their customers are buying. Figure 9 Training on products and services Training on understanding customers' business needs Training on sales processes or methodologies Training on specific sales tools and technologies Training on presentation skills 77.6% 72.6% 71.3% 57.4% 49.5% Training on negotiation tactics Training on selling to customer executives Training on financial acumen and ROI 40.2% 35.5% 30.2% Percent Rating Each as Critical for All Sales Roles, N= % 20.0% 40.0% 60.0% 80.0% 100.0%

12 10 P age Critical for Sales Management When asked which topic areas are most critical for Sales Management, the top three cited were: training on financial acumen and ROI, training on selling to customer executives, and training on negotiation tactics. Figure 10 Training on financial acumen and ROI Training on selling to customer executives Training on negotiation tactics 32.7% 40.2% 44.3% Financial acumen is considered particularly critical for higher-level sales roles. Training on presentation skills Training on specific sales tools and technologies Training on understanding customers' business needs Training on sales processes or methodologies Training on products and services 25.2% 20.4% 17.9% 17.6% 15.9% Percent Rating Each as Critical for Sales Management, N= % 20.0% 40.0% 60.0% Critical for Senior Sales Roles When asked which topic areas are most critical for Senior Sales roles, the top three cited were the same as those mentioned above (Figure 10). Approximately 45% of respondents considered training on financial acumen and ROI the most critical topic area when developing training for Senior Sales Professionals.

13 11 P age Critical for Inside Sales Roles When asked about topic areas critical for Inside Sales roles, respondents mentioned training on specific sales tools and technologies most often, followed by training on products and services and training on sales processes and methodologies. Figure 11 Training on specific sales tools and technologies 29.6% Training on products and services Training on sales processes or methodologies Training on understanding customers' business needs Training on negotiation tactics 24.3% 19.4% 17.9% 15.9% Training on presentation skills Training on selling to customer executives Training on financial acumen and ROI 10.3% 8.4% 7.5% Percent Rating Each as Critical for Inside Sales Roles, N= % 10.0% 20.0% 30.0% 40.0% When developing training for Inside Sales Professionals, respondents consider training on the basics most essential for their development. As the skills of these professionals mature, and they ve mastered the tools, processes, and product and service knowledge necessary, they will be more apt to handle the responsibilities of higher-level positions.

14 12 P age Rating Sales Skills Sales training programs can incorporate a variety of topic areas, but they are only relevant if these skills are effectively transferred to the sales force. When asked to rate the skills of their companies Sales Professionals, 66% of respondents reported that the product and service knowledge of their Sales Professionals is either excellent or above average. See Figure 12. In contrast, approximately 39% of respondents said that their companies Sales Professionals financial acumen is poor or below average. Figure 12 Product and service knowledge Understanding customers' business needs 4.7% 12.4% 44.8% 66.0% Approximately 39% of respondents said their Sales Professionals financial acumen is poor or below average. Sales methodology adoption Presentation skills Selling to customer executives Tools and technologies utilization 21.5% 19.2% 18.1% 35.5% 34.6% 33.7% 35.8% 33.3% Negotiation skills Financial acumen 16.8% 28.4% 31.4% 38.6% 0.0% 20.0% 40.0% 60.0% 80.0% Percent Rating Their Company's Sales Professionals as Excellent or Above Average Percent Rating Their Company's Sales Professionals as Below Average or Poor, Total N=108 (The majority of respondents reported that their companies Sales Professionals demonstrate average skills in the areas listed above.)

15 13 P age EXCEPTIONAL SALES SKILLS High Performers vs. Average Performers When juxtaposing the ratings of High and Average Performers, respondents from better performing companies rated the skills of their Sales Professionals as excellent or above average more often. See Figure 13. More specifically, High Performers rated the skills of their Sales Professionals two to four times higher than Average Performers in three key areas: Selling to customer executives Negotiation skills Financial acumen Figure 13 Product and service knowledge Understanding customers' business needs 39.6% 55.6% 71.7% 64.6% Companies considered High Performers rated the skills of their Sales Professionals two to four times higher than Average Performers. Selling to customer executives Sales methodology adoption Tools and technologies utilization Negotiation skills 20.9% 29.2% 27.1% 17.0% 51.2% 44.7% 42.2% 40.9% Presentation skills Financial acumen 6.5% 40.0% 31.3% 27.3% High Performers, N=47 Average Perrformers, N=49 0.0% 20.0% 40.0% 60.0% 80.0%

16 14 P age Assessing Sales Training Impact CURRENT ASSESSMENT METHODS Respondents were asked how their companies currently assess the quality and impact of their sales training programs. The majority of respondents reported performing Kirkpatrick Level 1, followed by Kirkpatrick Level III and Kirkpatrick Level II, respectively. High Performers vs. Average Performers To determine if High Performing companies assess the quality and impact of their sales training more effectively, their methods were compared with those of Average Performing companies. In general, High Performers assess the quality and impact of their companies sales training programs more often, using Kirkpatrick Level IV (excluding ROI) more than twice as often as Average Performers. In addition, as Figure 14 depicts, approximately 35% of Average Performers don t assess the quality and impact of their sales training programs. Approximately 35% of Average Performers don t assess the quality and impact of their companies sales training programs. Figure 14 Kirkpatrick Level I 50.0% 52.1% Kirkpatrick Level II 31.3% 43.5% Kirkpatrick Level III Kirkpatrick Level IV (excluding ROI) 16.7% 43.5% 35.4% 41.3% Return on Investment (ROI) 28.3% 20.8% Return on Expectations (ROE) 16.7% 28.3% Do not assess training quality and impact High Performers, N=46 Average Performers, N= % 35.4% 0.0% 20.0% 40.0% 60.0%

17 15 P age Sales Training Sources When developing effective sales training programs, there are a variety of sources that companies consider before determining which best fit their training needs. Respondents were asked to consider their preferred source(s) for each type of sales-related training. Figure 15 presents the various types of sales training, along with which sources respondents prefer for each. Overwhelmingly, respondents favor internal sources for most types of sales training except for sales skills training, for which they prefer a blend of internal and external sources. Figure 15 Product training (e.g., new releases, newly acquired products) 82.4% 2.0% 15.6% Tools training (e.g., technologies, CRM usage, marketing resources) 58.8% 12.3% 28.9% Business skills training (e.g., understanding customers' business needs, ROI, financial acumen) 44.9% 13.3% 41.8% Sales methodology training (i.e., implementing standardized or new practices) 44.6% 19.8% 35.6% Sales skills training (e.g., negotiating, presenting, prospecting, questioning) 30.8% 24.0% 45.2% 0% 20% 40% 60% 80% 100% Internal External Third-Party A blend of internal and external Total N=108

18 16 P age Best Practices To help Learning Leaders initiate or improve their companies sales training programs, respondents were asked to share their best practices for developing and refining the skills of Sales Professionals. The most cited best practices are listed below, highlighting the importance of strategic alignment, measurement and organizational support. Ensure support and involvement from all levels of the organization, including Sales Professionals, Sales Management and company Leaders. Define a coaching strategy within your sales training program, and ensure that coaching is an ongoing process instead of a single event. Establish clear measures of success for Sales Professionals and continuously assess their performance, modifying the training as needed. Make sure that business strategy and goals are understood by all Sales Professionals and align training goals to meet these needs. Provide ongoing training and reinforcement, catered to the specific needs of Sales Professionals. In addition, there are certain practices of High Performers that companies can emulate to enhance their sales training programs: Ensure that each sales training program addresses the importance of understanding customers business needs. Integrate training on selling to customer executives and financial acumen into sales training programs. Measure the effectiveness of each sales training program and evaluate their impact on business results.

19 17 P age Moving Forward High Performers place more importance on training for selling to customer executives and financial acumen and ROI than most other sales training areas, which stresses the relevance of business knowledge and market insight. Sales Professionals from better performing organizations are also more adept at these skills, which further emphasizes why they may be experiencing greater revenue growth. Further, these organizations tend to evaluate the quality and impact of their training programs more often, and use higher level assessment methods when doing so. Kirkpatrick Level IV involves the analysis of sales training s impact on business, including increased sales, retention, or quality ratings, or decreased turnover, complaints, failures, etc. This implies that High Performers are assessing their sales training programs to determine how they actually drive business results. Using the best practices as a starting point, and incorporating topic areas that are considered critical by High Performers, sales training programs can begin to evolve into more effective, results-driven programs. In addition, by addressing the skills that High Performers Sales Professionals have mastered, Learning Leaders can enhance the skills and performance of their own companies sales force. With continuous assessment and improvement Learning Leaders can demonstrate their own contribution to their company s bottom line.

20 18 P age Demographics INDUSTRIES REPRESENTED Fifty percent (50%) of respondents are from the top five industries: Business Services/ Consulting, Durable Manufacturing, Banking/Finance, Technology & Insurance. Figure 16 Business Services/Consulting Manufacturing, Durable Banking/Finance Technology Insurance Pharmaceuticals Telecommunications Training & Development Media/Entertainment Retail Medical Education Hospitality Manufacturing, Non-Durable Wholesale Distribution Healthcare Non-profit Engineering Construction Government Mining Transportation Utilities Percent of Respondents, N=110 COMPANY SIZES Approximately 53% of respondents are from companies with 500 employees or more. Figure % 8.2% 8.2% 6.4% 5.5% 5.5% 5.5% 4.5% 4.5% 3.6% 2.7% 2.7% 2.7% 2.7% 1.8% 1.8% 1.8% 0.9% 0.9% 0.9% 0.9% 0.9% 18.2% 0.0% 5.0% 10.0% 15.0% 20.0% 20.0% 15.0% 10.0% 5.0% 0.0% 15.5% 6.4% 7.3% 18.2% 8.2% 13.6% 10.9% 6.4% 4.5% 9.1% Percent of Respondents, N=110

21 19 P age Demographics DEPARTMENTS Approximately 81% of respondents hold positions in Sales or Human Resources. Figure 18 Customer Service, 6.4% Finance/ Accounting, 0.9% Sales, 48.2% Human Resources, 32.7% Percent of Respondents, N=110 JOB ROLES Research & Development, 1.8% Information Technology (IT), 2.7% Marketing/ Advertising, 7.3% Seventy percent (70%) of respondents hold leadership titles (e.g., management or executive-level roles). Figure 19 Consultant/ Specialist/ Analyst, 10.9% Associate, 1.8% Instructional Designer, 5.5% Instructor, 1.8% Trainer, 10.0% Executive, 40.0% Manager, 30.0% Percent of Respondents, N=110

22 20 P age About this Research ABOUT EXECUTIVE CONVERSATION, INC. Executive Conversation is a global provider of business skills sales training. The company s onsite and online training is delivered by accomplished executives who share their insights from careers making investment decisions. Executive Conversation has successfully worked with teams in more than 60 countries and seven languages and is the only sales training provider whose curriculum is accredited by the International Association of Continuing Education and Training (IACET). For more information, go to call or connect with us on Twitter and LinkedIn. ABOUT TRAINING INDUSTRY, INC. TrainingIndustry.com spotlights the latest news, articles, case studies and best practices within the training industry. Our focus is on helping dedicated business and training professionals get the information, insight and tools needed to more effectively manage the business of learning. For more information, go to call or connect with us on Twitter and LinkedIn. ABOUT THIS RESEARCH Copyright 2013 by Executive Conversation, Inc. and Training Industry, Inc. All rights reserved. No materials from this study can be duplicated, copied, re-published or re-used without written permission from Executive Conversation, Inc. or Training Industry, Inc. The information and insights contained in this report reflect the research and observations of Executive Conversation, Inc. and Training Industry, Inc. analysts.