Whether you are talking about sports coaches, military generals or senior executives in business, strong leaders are hard to come by and make all the difference.
In today’s rapidly evolving business environment, strong and effective sales leadership is the most critical piece required to build a high performing sales team. In fact, a study published by Harvard Business Review found that 69% of salespeople who exceeded their annual quota – top performers – rated their sales manager as being “excellent” or “above average.”
However, hiring a Vice President of Sales is one of the most frequently botched hires in all of recruiting. Corporate leaders have a tendency to want to promote superstar sales reps into manager positions thinking the competencies transfer on a one-to-one ratio. But because they are vastly different roles with different skill sets, this results in alarmingly high sales management mis-hire rates.
The Sales Management Association’s Hiring Top Sales Managers Research Report found that more than 75% of sales reps promoted into a management role will return to a sales position within two years, while Sales Benchmark Index reports the average tenure for a new Vice President of Sales is only 19 months.
As the CEO of Peak Sales Recruiting, we have seen some of the most successful companies in the world misfire when it comes to hiring sales leaders. The cost of a bad sales hire is enormous and reverberates across the company in a myriad of ways from lost market share to damaged sales team morale.
Thankfully, there are ways to mitigate this risk and it starts with knowing the competencies possessed by the world’s best sales leaders.
Here are the top 6 competencies of great sales leaders in order of importance:
- They attract, acquire, and develop talent: The best sales leaders understand that recruiting proven talent has the biggest impact on their ability to meet aggressive revenue targets. They know that their talent acquisition and development plan can’t just be tied to the sales strategy, it needs to go beyond and link to the corporate strategy to remain agile.
- They develop strategic plans using data: The best sales leaders understand industry trends and patterns; they take a data-driven approach to analyzing market and territory potential, and use this information to optimize the size, structure, and profiles of their teams to ensure the sales strategy is successfully executed.
- They know how to motivate: Sales teams that possess energy and confidence are successful, and good leaders know how to keep morale high whether business is at a peak or in a slump. Since motivation is an intangible quality, the best sales leaders develop unique approaches that are tailored for their people. They know, for example, that being creative and fun with sales competitions or unique vacation rewards can often pay huge dividends. For example, Rick Hanson, the former vice president for Hewlett-Packard Enterprise Security, said his company had success implementing a Fantasy Sales Team that worked just like a fantasy football team where players (sales reps) got points for increasing a pipeline or closing a deal.
- Uses a customized management approach: Great sales leaders understand that each team member is unique. Phil Jackson, who coached Michael Jordan, Kobe Bryant and is the winningest coach in NBA history with 11 championships, famously assigned each player a book to read that he thought would benefit their mentality and approach to the game. The leadership lesson every great sales leader knows is that there is not a one-size-fits-all management approach. The best adapt their style to get the most out of every team member while keeping them in lockstep with company objectives and strategic priorities.
- Are target driven and vigilant: The best sales leaders are vigilant about achieving quotas and keep their team focused on daily, weekly, quarterly and annual goals. They are not easily distracted from their core mission and don’t let obstacles impede their ability to achieve their strategic objectives.
- They must be able to sell, but only sometimes: This is the last tip by design because it does not deserve to be in the top five. Yes, it is important for your sales leader to be able to sell – but only where their experience, pedigree, and position add critical value that helps salespeople execute the right sales process.
The biggest mistake companies make when hiring a sales leader is equating their individual sales success with their ability to recruit, train and lead a sales team that delivers against its number. But organizations that hire candidates who possess these 6 competencies will see a rise in the effectiveness of their salesforce.