Stop Random Acts of Sales Support

I just finished reading Scott Santucci's (Forrester) new report, Uncovering the Hidden Costs of Sales Support, and want to share some insights to the amazing amount of money spent on enabling quota-carrying sales reps that you may not realize.

During a time when cost cutting is imperative, not knowing about the extent of these costs or the cause/effect relationship they have to achieving top-line sales outcomes can wreak havoc on your company's ability to grow strategically.

Here's the startling discovery made when doing research across 57 public technology companies for this report:

"Technology vendors are spending, on average, 19% of their selling, general and administrative (SG&A) costs or $135,262 per quota-carrying salesperson in support-related activities."

That's a lot of dough. And it doesn't include base or variable costs like salaries, benefits, commissions and incentives.

The basic problem Scott points out is that all this spend is likely hidden across varying departments and projects (and likely termed differently) — thus hard to identify as sales support spending. Not to mention the difficulty in assessing overlaps or disjointed efforts that don't help your company accelerate sales objectives or are just plain redundant.

Forrester points to 4 Core Sales Activities that all sales enablement spending should impact:

• Gaining access to the appropriate stakeholders.


• Conducting successful sales meetings with conversations that progress buying intent.


• Helping buyers envision your solution as a valuable way to solve their problems and seeing the path to getting their desired outcomes.


• Communicating the reasons and value that enables a buyer to build a business case, whether objectively and/or emotionally justified, that leads to buying.

The way to stop random acts of sales support begins by mapping all sales enablement initiatives to the four core sales activities.

• Look across all departments - for example, a Human Resources expenditure for sales training certification probably isn't on the radar as a direct sales support expense.


• Include spending on collateral, sales tools, demand generation, sales training & coaching, best practice aids and support services.


• Assess the overlap in initiatives undertaken in support of each core activity. Eliminate redundancies.


• Correlate the flow across marketing-to-sales efforts. For example, if salespeople are being trained to sell with a methodology, do marketing materials support and reinforce that style of selling?


• Evaluate the relationship to all sales support initiatives to the company's strategic priorities—as defined by the CEO. If a cause/effect relationship to those priorities can't be established, sustaining that program should come into question.

I've written a lot about sales enablement. In fact, empowering sales support effectively was the subject of one of my vision posts for 2009. This Forrester report shines the light more brightly into this chasm between marketing and sales, calling into question the escalating costs that result from a lack of cross-departmental alignment to business priorities as related to selling expenditures.

In a time when companies are being challenged to do more with less, do you know both the short and long-term effects of each of your sales support programs? Do you really know which ones you can consolidate, or even eliminate — without causing damage to the top-line achievements your company is counting on?

Scott issues a great challenge to company executives that could open their eyes to  support spending their salespeople may not find relevant (read wasteful).

Here you go:

If you asked your salespeople how they'd spend $135K to improve their sales outcomes, how likely would they be to choose the initiatives you've already chosen for them?

What do you think?

Comments

[Jep Castelein (LeadSloth)]

Great post. Wow, $135k that's a lot!

I think that sales people can vote with their feet by returning leads to marketing that they feel are not sales-ready.

They should not care how the money is spent. If they would, I guess many would spend at least $50k on a new car and have a great story why that makes them sell more :-)