Unstoppable Sales

Is your sales force design holding you back?

By Jeremy Miller

Every day sales people hit the street looking for opportunities to sell their wares and ultimately generate revenue for their companies. Some reps find new customers, while others develop sales opportunities with their existing clients. Classically these two activities are categorized into "hunting" and "farming." Depending on the sales person they are typically drawn to one of these categories of selling over the other. The sales person's behavioral profile and natural talents dictate their preference.

The question to ask is why do most organizations structure their sales reps by territory where the sales people are responsible for finding new business and growing existing clients? The impact of this strategy leads to the development of broad gaps of performance in the sales team. Hunting and farming a territory are two distinct activities, and by separating them you can improve sales performance by focusing your people on what they do best.

When sales people are categorized as hunters or farmers you will quickly see how their responsibilities, goals and attributes differ. Hunters immediately bring to mind our stereotypical sales profiles. These sales people find and secure orders with new clients, and once the deal is signed they move on to the next new piece of business. Hunters excel at generating and qualifying leads, making persuasive presentations and moving people to action. They are full of energy and possess high levels of endurance, which is necessary when the majority of people they first encounter are indifferent to doing business with them. In a sales organization the hunter is responsible for new business development.

Farmers pick up where the hunters leave off by continuing contact with customers and securing future orders. Farmers maintain relationships with existing customers, and often act as an advocate for the customer. They possess high product knowledge, and often proactively discover customer support issues before they fester. Within the sales organization farmers are sometimes referred to as "Account Managers."

When we look at hunting and farming as distinct positions it is very obvious how the ideal person for each role is very different. Yet for most firms these positions are grouped together. Momentum Corporation, a mid-market software vendor, faced this very challenge. They had experienced explosive growth in their first four years of existence. They were considered the dominant player in their market, and had quickly risen to exceed seven and a half million dollars in annual sales in less than four years. In 2003 Momentum began to plateau. Revenue growth was stagnant, turnover in the sales force was high and none of their reps could consistently perform quarter over quarter. Management was very frustrated.

Like most organizations, Momentum aligned their sales people by territory. The mantra was, "I don't care where the revenue comes from, just go get it." Sales people are primarily measured on revenue. In general, where revenue comes from is not closely scrutinized, measured or rewarded. As a result a company cannot easily control the activities of its sales people, because the reps will tend to follow the path of least resistance and go for the low hanging fruit. Momentum's reps were no different. They tended to focus on serving their existing customers, and had transitioned into a group of farmers. The result was Momentum's management could not trust or bank on the sales funnel. Revenue came in fits and starts, which made it very difficult to hire new employees or invest in research and development activities.

Momentum recognized that its growth was dependent on acquiring new customers. Their market was rapidly consolidating, and the barriers of entry for competitors were low. The answer was to separate the sales force into business development and account management. They did extensive research on each of their reps to identify the traits that stood out for the best hunters and the best farmers. They used a combination of behavioral profiling, skills assessments and reviewing the reps in action to understand the differences between hunters and farmers. Using this intelligence they developed new job descriptions and ideal behavioral profiles to rebuild the sales team and hire people to fit the new requirements. The pursuit paid off. Within eighteen months of this project they are on a new growth track, and increased sales by thirty-five percent in 2005.

The decision to separate hunting and farming into distinct positions must come from the top. The first step in the process is to clearly articulate the separation of revenue projections and goals into new business development and existing client development. Rather than stating sales targets for the following fiscal year will be "x," management should take the step to define the total goal and then build accountability into the system by stating what percentage will come from new business development and what percentage will come from existing customers. This step will clearly articulate if the quotas are realistic, as well as what skills and resources the sales team will require to reach their designated quotas.

As the roles are separated a new set of measurements are required to manage and motivate the sales people to peak performance. Revenue is still an important measurement, but it is also important to measure and review weekly activities and behaviors to ensure each of the reps will achieve their quota. When hiring new sales people it can take four to six months just to get them up to speed. This is a long time to invest in someone to find out nine months later they aren't going to cut it. The measures of a hunting role may be more concerned with suspects generated per week, the conversion ratios from prospect through to close and the ongoing activities required to achieve quota. Sales quotas are much easier to achieve when a sales manager proactively reviews and manages these activities weekly, because the reps are being managed to their behaviors. Everyone knows what is required to achieve success.

Momentum implemented strong business process to manage the distinct activities of their hunters and farmers. Hunters focused on building a constant pipeline of qualified prospects to close. The management team spends a great deal of time working with each of the business development reps to keep a consistent funnel, and to focus their activities to quickly qualify potential business and move it through the funnel. The farmers are measured under a different set of criteria. They are responsible for coordinating the software implementation, and are also managed by account driven objectives. Each account manager is responsible to build strategic account plans for their "A" customers, and they are measured on the achievements of each plan's objectives.

Separating hunting and farming into separate positions is a sound strategy, but it can only work with the right people. It is a complete cultural shift to renovate the sales department, because it transitions the team from a group of generalists into specialists. Many sales people do not survive the transition, and the sales team will look very different even six months after the strategy is implemented. The key job for management is to place the right people in the right positions, and get everyone who does not fit into the new structure off of the bus. Once the team is filled with specialists focused on clear goals, growth is unstoppable.

Jeremy Miller (Jeremy.Miller@LEAPJob.com) is a Partner with LEAPJob (www.LEAPJob.com), a recruiting and consulting firm. LEAPJob helps its clients build top performing sales teams. You can reach Jeremy at 905.281.3090, Ext. 22.