Friday, October 17, 2008

Segmentation of the Sales Process

In a time when the economy is facing uncertianty, companies are looking for more and more solutions to lower costs. Companies want to discover new ways to do more with less. The days are over, for now, when money for capital investment is pleuntiful. The buzz now it how a company, weather you are one person, or a top Forturne 500 player, the objective is similar. How can we save money? How can we do more, with less. I propose a solution that may seem counter intuitive, yet has a more dramatic effect than most others. Add new sales reps. 

You may be asking, save money, hire a new sales rep? How is that logical. I'll show you. 

The structure of most sales organizations is designed such that the individuals involved can focus on one or two aspects of the sales process. The idea of segmentation in the sales process is a fairly aged concept. What most organizations don't realize is they are neglecting, and possibly even skipping altogether, a few of the most essential roles in the sales process. I am going to outline for you the most neglected function in the sales process.

The Fronter

As new leads enter the sales funnel, most organizations route these leads based on some type of routing rule. The most common, and least effective, is region based. When the sales representative gets the lead, he or she initiates the evaluation process. They start to ask themselves qualification questions based on prior experience. It's like getting judged when you walk into a new car dealership based on the current car you are driving, what clothes you are wearing, and how good looking you are. Everyone of us has had this experience. It is a biased disqualification. But why should a sales representative waste his or her time on a lead they think will never close? This is a fundamental error in most every sales team in every company in the world. The objective is to take the pre-qualification step away from the sales person and give it to someone who's goal is not to close the lead, but to qualify the lead. Thus, we further segment the sales process. 

By moving the qualification step to a seperate individual, we pass on only those leads who are interested and qualified. Because the goal, and compensation, of the fronter is to qualify and set appointments, they are highly motivated to do so. In a recent study done with MIT, it has been found that close rates increase by almost 7% by simply adding this step and combining technology to increase a fronter's dialing capacity. 

This is just one step a sales organization can take to do more with less. In most organizations, the current sales staff will be unable to handle the volume of appointments handed to them by a quality fronter. This is one of those good problems to have.