Stephan M. Liozu is Chief Value Officer of the Thales Group (www.thalesgroup.com) and Chief Marketing Officer of Thales Inc. in the USA. He is also an Adjunct Professor & Research Fellow at the Case Western Research University Weatherhead School of Management. He is a Certified Pricing Professional (CPP), a Prosci® certified Change Manager, and a Strategyzer Business Model Innovation Coach. He authored four books, Value Mindset (2017), Dollarizing Differentiation Value (2016), The Pricing Journey (2015) and Pricing and Human Capital (2015). Stephan sits on the Advisory Board of LeveragePoint Innovation and of the Professional Pricing Society. He is a Strategic Advisor to 360pi, The Kini Group, and PriceSenz.

The Pricing Advisor, April 2018

Scientific Selling: Turn Your Sales Force into “A” Players

Every year firms pour hundreds of million dollars into sales force training and development. Leaders expect that by continuously training their sales reps on negotiation, sales excellence, presentation skills and selling psychology, they will dramatically improve their sales force effectiveness. To a certain extent they are right. But developing a sales force without proper segmentation work in the first place might lead to some level of frustration and less than optimized outcome. In essence, having a super sales rep in front of the wrong customer with the wrong price might not lead to a better outcome. Yet, every year, many firms continue training their sales force and avoid having discussions on customer segmentation. This falls well into Einstein’s definition of insanity.

Going through the process of scientific segmentation to improve the scientific selling process provide a tremendous benefit. It is all about increasing sales effectiveness and boosting the impact of your sales force in the field. But it is also a powerful tool to level the playing field for your sales force and to measure the true performance of each sales representative.

Here are some of the critical benefits of scientific selling:

1. Isolate the true customer and segment mix: Scientific segmentation allows you to create transparency in your sales data so that no one can hide behind the blurry numbers or use the mix excuse. The combination of segmentation and data analysis truly levels the playing field so that each sales rep can be compared across similar customer segments. Specific actions can then be taken to bring all reps to certain thresholds in each segment.
2. Increase revenue per sales rep: Because the sales force will spend more quality time with customers that are growing and willing to pay for things, the average sales revenues per customer should start improving faster than before. Sales effectiveness is all about generating incremental sales revenues with existing resources.
3. Benchmark sales reps with the right metrics: By conducting multi-level segmentation using your transactional data, you can design specific objectives, quotas, and tasks that can then be tracked with rep-specific dashboards. This allows you to extract the metrics at the click of a button once you have designed then in your optimization software. That represents a true benefit for sales leadership in order to coach and guide each sales rep in the right direction.
4. Compare apples to apples: Markets are different. Customer groups are different. Regional dynamics can vary quite a bit from state to state. All of this has to be considered when you conduct a portfolio analysis of your sales force’s strengths and weaknesses. Transparency in the data will guide in the development of your B and C players as well as in the management of your A players.
5. Identify champions: With that level of data transparency, you can identify your internal sales champions and leverage them to coach other less performing sales assets. The sharing of best practices across buyer groups or customer segments will lead to quick wins. You can then establish a “buddy system” that will boost the confidence of your entire sales team without using expensive consultants or trainers.

The power is in your data. Before spending in training and development of your sales force, ask yourself the following questions:

• Are my sales reps spending enough time with my top customers?
• Is the problem with my sales force a skills problem, a sales qualification problem, or a value selling problem?

Spend some time analyzing the root cause of the pains you are experiencing with your sales force. Then consider segmentation as a good way to solve some of these problems.

Scientific Selling: Optimize Your Sales Resources

“We have to grow!” How many times do you hear this in sales leadership meetings or in strategic planning discussions? Since the end of the “great recession” that started in 2008, firms have been focusing on identifying pockets of growth to further diversify and capture sales from prospects and non-buying customers. The tendency is to look at sales growth with a linear relationship with sales headcount addition. So it goes like this: every sales rep brings $XYZ sales per year on average + our target is to grow by X% or $ABC = let us add the necessary sales headcount to go after growth targets. Traditional selling approaches would embrace this approach. The scientific selling approach breaks traditional paradigms. Powered by science and data, this new approach allows sales leaders to adopt a more robust and scientific approach to sales organizational design and to sales resources allocation.

Here are some of the critical dimensions on how to implement scientific selling:

1. Revise your sales organizational design: Growth in sales revenue and in sales expenses cannot be considered as a linear relationship. A robust sales effectiveness assessment will show you how your salesforce is spending its time, where they are spending their time, and what the specific impact of their sales actions are. Mining your sales data will surface areas of dysfunctionality that can be solved with a new commercial process and a renewed organizational design. Adopting scientific selling as a part of a commercial excellence program can give you an amazing opportunity to go through this exercise.
2. Train your salesforce on segmentation and scientific selling: Change happens. Moving from a traditional sales approach to a scientific segmentation and selling model can represent a potential disruption. Change management and training will become paramount in making sure your salesforce understands their roles, the new commercial process, and the power of data. Do not under-estimate the need to communication, training, and reinforcement. Get the salesforce on board as soon as possible.
3. Grow without adding headcount: Times are still rough. With flat demand curves and growing competitive pressure, sales leadership is asked to do more with less. It is irrational to think that top leadership will give the green light to add dozens of sales headcounts to chase growth. The focus should be on sales effectiveness and productivity. Can you do more and grow with the current headcount level? Can you re-allocate your salesforce to data-derived market segments to reach greatest potential? This is what top management is going to expect to hear from sales leaders.
4. Beef up your back office: The role of the back office is critical in the scientific selling model. Back office includes sales operations, lead generation experts, inside sales teams, sales analytics groups, etc. Pricing and IT are also part of the support team. The role of the back office group is to make sure sales reps are in front of the right customer, at the right time, and with the right data in hand. The end results of this change in paradigm is a reduction of pure sales headcounts and an increase in back office sales staff.
5. Reach commercial excellence: Reaching commercial excellence is not business as usual. Adopting scientific segmentation and selling models requires breakthrough thinking. You cannot think of making this change without changing your culture, your organizational design, your support staff, your incentives plans, etc. It is a transformational exercise that also requires top management training and support.

The future of sales management is in front of us. The big data revolution has already transformed the marketing function. Next in line are sales and pricing. Do not miss this window of opportunity and consider leveraging the powerful data you have in house now.