In our recent research on “The Top-Performing Sales Organisation”, RAIN Group gathered responses from 472 participants in 26 industries in an effort to answer two seemingly simple questions:
- What do top performers in sales look like ?
- What do they do that make them top performers ?
What top performers in sales look like
If you’ve read my blog before, you know I’m a huge fan of the Pareto Principle (aka the 80/20 rule). What we didn’t expect was for that principle to turn up in our research quite so literally: altogether, we found that 20% of sales organisations can be qualified as top performers. Which also meant that 80% … aren’t.
According to what we’ve found, Top Performers:
- Have average proposal win rates of 40% or greater
- Maintain or increase both revenue and profitability annually
- Have challenging organisational sales goals
- Consistently meet those goals (even though they’re challenging)
- Charge maximum prices in line with the value provided
In other words, these are organisations that set and achieve challenging sales goals, charge (often well) above the market, win around 1 out of every 2 deals they propose or quote on, and increase both revenue and profitability year on year.
Sounds like my kind of team.
But how exactly do they create the kinds of organisation that drives such impressive results ?
There’s no easy answer, but we have found there are some factors that contribute more than others.
They are value-driving
First off, top performers tend to be value-driving sales organisations. This means they focus on driving maximum value for the customer, taking an outside-in perspective rather than the inside-out angle that most organisations adopt.
Top performers in sales align their sales process with how customers buy, making it flexible and customer-focused. And company leadership prioritises developing sellers to be as valuable to buyers as possible (more on that later).
And the results clearly show those efforts pay off: value-driving organisations have higher win rates, higher revenue growth and lower undesired turnover.
They focus on process
There’s a myth that’s been perpetually permeated within our industry: it’s that sellers alone can drive value for customers. Hire great people, tell them what to do and the rest will take care of itself.
In reality, where it’s true that a large proportion of the perceived value (by the buyer) comes from the seller, the seller cannot make that happen alone.
Something else is needed: process.
As we’ve found, organisations who have more mature sales processes tend to have higher win rates –in fact, the difference between a “defined” and “world-class” sales process is close to 25%.
If the sales process is flexible, and it can apply to buyer’s various roles and situations, the win rate gap is over 30%. And if the sales process is customer-focused, and maps to the buying process, win rates differ by no less than 40% !
But process is only part of the equation. Another part is what comes next: skillset.
They invest in skills development
In today’s world, buyers buy from sellers who educate with new ideas and perspectives, and who work with them collaboratively during the buying cycle.
Saying that is simple, but doing that isn’t.
Most organisations we work with admit that their sellers are often woefully inadequate when it comes to making the transition to what we call Insight Selling. Sellers are used to “pitching” products and services. They’re reactive rather than proactive. Hesitant to reframe buyers’ thinking for fear of negatively impacting the relationship.
In order to help sellers make that transition, organisations need to work on two critical aspects: skill set and mindset.
Check out the graph below. Across every aspect of what we’d call the core foundations of a successful sellers’ skill set, Elite and Top Performers have far higher levels of ability. In other words, their people are just much better across the range of skill sets that matter.
But why exactly is that ?
Do they simply hire better people ? (Sometimes, but it’s not just that).
The fact is that top performers in sales have far higher levels of both sales training maturity and sales training effectiveness. In other words, they don’t just offer “a lot of sales training”. When they do, they make sure it’s more effective, and it’s steeped in the latest practices around adult learning and behaviour change.
Elite and Top Performers invest more money in training their people, and when they do they make sure their methods are state-of-the-art and learning translates into actual behaviour change – leading to a dramatic, positive change in results.
They lead from the top
The final part of the equation is management and leadership. It’s hard to overemphasise the importance of leadership in building strong commercial organisations. If management prioritizes and actively works to maximise the time they spend coaching their teams versus other activities, they create and sustain maximum energy from sellers, leading to maximum performance.
Unfortunately, in most organisations, only 28% of sellers agree that their management does this.
Meaning 2 in 3 sellers don’t.
But it’s not just about the role of management – change starts at the top.
In Elite and Top Performers, leadership (which we’ll define as business leadership, i..e not just commercial. Think CxOs and C-Suite) prioritise improving sales force effectiveness, and when they do it gets done.
(If the last point seems self-evident, consider that in most organisations only 51% of sellers feel that when leadership sets a priority, it gets done).
When it comes to top performers in sales, there are no easy answers. It takes a thousand things to build – and sustain – elevated levels of performance. But there is a method to the madness.
First, Elite and Top Performers have a relentless focus on driving value for their customers. They organise their processes in such a way that the customer stands front and center. They equip their people with the necessary skills to deliver immediate value when they’re in front of a customer. Their management takes an active interest in coaching sellers. And their leadership makes it a top priority, and makes sure the entire organisation acts upon it.
At the risk of oversimplifying, if I had to turn it into a mathematical equation, it would look like this:
Value + Customers + Skill Set + Coaching + Leading = 73% (Win Rate).
But this isn’t about mere math – it’s about describing a journey. A journey to building a virtuous circle in which all of the elements mentioned above work together to propel an organisation (and its wins, revenues and profits) sky high.