sales & key account management

SALES & KEY ACCOUNT MANAGEMENT

SANDEEP SINGHAL

1

The definition of salesmanship is the gentle art of letting the customer have it your way.

- Ray Kroc

Agenda

• Introduction • Sales force structure and design• Sales force planning and recruitment• Characteristics of a champion Sales person• Sales force training• Sales force performance and measurement• Sales force compensation• Sales Process • Sales Management process – Funnel Management/CRM• Key Account Management – Introduction• Key Account Management – Key Factors• Why choose sales profession • Wrap up and Q&A

Sales Force Structure

Sales force can be structured on following lines :• Territorial• Product• Market• LoB (Line of Business)• Vertical• Hybrid

Designing the Sales Force

Sizing of Sales force is done based on workload

• Group customers by volume• Establish call frequencies• Calculate total yearly sales call workload• Calculate average number of calls/year• Calculate number of sales representatives

Average utilisation of sales force

Peak Sales Performers Utilisation

Sales time down the drain…….

Recruitment of Sales Force

• Identify• Search• Qualify• Assess• Interview

He’s a big bad wolf in your neighborhoodNot bad meaning bad, but bad meaning good—Run DMC, Peter Piper

Lessons in sales from……

• Identifying needs – First step• Creating Urgency• Applying Needs and urgency in sales• Never stop selling• Motivate your sales team• Focus on training• Embrace adversity

Four rules for Hiring Smart

• What you know changes, who you are doesn’t• You cant’ find what you are not looking for• The best way to evaluate people is to watch

them work• You can’t hire people who don’t apply

Traits of a Sales Person

• Attitude

• High energy

• Hunger

• Ability to handle stress/high pressure situations

• Street Smart (vs Book Smart) – Ability to think on feet

• Excellent listening skills/non verbal cues

• Excellent Questioning skills

• Presentation skills

• Ask and you shall receive – Ability to close deals

• Integrity - Builds trust/honors commitment/keeps word

• Relationship magician

• Be indispensable to the client

Hunting and Farming

• Hunter – Type of sales rep who – is focussed on closing deals with new customers– moves on aggressively to a new prospect after

closing a deal– is hunting for a new “prey” all the time

• Farmer – Type of sales rep who– cultivates and nurtures customer relationships– develops in depth understanding of customers’ needs

and business– is focussed on getting repeat business from

customers

Types of Sales people

• Inside Sales– Employers’ place– Make calls– Telemarketing– Take orders

• Outside Sales – Face to face contact– Meet customers

• Thru Channels

A rose by any other name……

• Account Executive• Business Development Manager (BDM)• Territory Manager• Regional Manager• Sales consultant• Sales associate• Sales Engineer• Marketing rep

Sales Training

• Company knowledge – History, legacy and culture

• Business and Products/services• Internal company processes• Industry knowledge• Competitor knowledge• Customer knowledge • Government rules and regulations

Types of Sales Training

• Induction training – Typically 2 days– Face to Face, includes onboarding plus familiarisation with

company policies, procedures and HR issues

• Sales School/Sales Mastery training – 5 days– Detailed Product/Services knowledge

• Contractual/Legal/Deal management trainings – 2 days– To impart in depth training on firm’s legal/contractual terms

and conditions

• On line trainings on company’s portal/intranet/hub

Sales Force Performance & Measurement

• Number, numbers, numbers – Sales numbers/quotas

However• A few other numbers which are measured include

– Number of new Accounts developed– Profitability– Number of Days Sales outstanding (DSO) – A measure

of accounts receivables– Customer satisfaction Index

Sales Force Compensation

COMPONENTS • Fixed pay• Variable pay – Short term/Long term• Incentives – Spot incentives/Cash rewards• Bonus – Annual Bonus/Signing Bonus/Retention• Expenses – Travel Expenses• Benefits – Statutory and Retirement benefits

Sales Force Compensation

• Sales Quota• Proportion of Variable Pay – 50:50/60:40/70:30• Accelerators• Thresholds• Commissions• Stock Options• Benefits

Sales Process

• Prospecting and qualifying• Pre approach• Approach• Presentation/demo• Handling objections• Negotiations• Closing• Follow up

Sales Management Process

• A single view of the various opportunities being worked on by the entire sales force within an organisation

• Forms the basis for forecasting revenues• The process of

– Identifying – Prospecting– Generating leads– Presenting solutions– Closing sales– Post sales activities

Sales Management Process Components

• Sales Stage• Probability of win• Pipeline• Forecast• Upside• Commit

PROSPECTS

LEADS

NEW CUSTOMERS

SatisfiedCSI > 70

UnsatisfiedCSI< 70

Mar

ketin

gS

ales

Cus

tom

er S

ervi

ceBrand Building

CRM

OPPORTUNITIES

CRM

SUSPECTS

Sales Funnel

Visitors

Prospects

Leads

Opts

Predicting the Future

Predicting the Future - The Forecast

Closed Likely Upside Q+1 P E D D I C C RD% VP% Fcst UpsideeCommerce 248,405 47,250 15,000 10,000 9,025 9,000 Inside Sales 207,900 10,000 - - 1,000 - Salva Army: Stryker 125th TF Olympia 151,662 - - - - - McPartland KPMG - Services 150,000 - - - - - Black BAH / Centrix 78,183 - - - - - Okada NG / State Near East Bureau 62,894 - - - - - Okada CARE 60,266 - - - - - Foster Tyco - software 56,389 - - - - - Marcus CA Dept of Justice 56,279 - - - - - Wilson Microsoft 54,856 - - - - -

37,021 - - - - - Smith SPAWAR-DM,B/U Svr 36,794 - - - - - Black DARPA (SAIC/Hicks) 32,218 - - - - - Tyre EDS 28,265 - - - - - Foster Praxair 23,977 - - - - - Marcus State of FL 22,943 - - - - - Shartzer LDS - Deseret Mgt 18,483 - - - - - Shore P&G 17,987 - - - - - Manniso VA - Infrastructure (Albany NY Buyer) 15,120 - - - - - Tyre Shell - trial extension 15,000 - - - - - Smith SPAWAR Europe/Ivan(2) 14,075 - - - - - Salva Army Corp. Of Engineers - 1,808,559 - - Y Y Y Y Y Y Y 50% 50% 904,280 - McPartland EY - enterprise - 787,000 - - Y Y Y Y Y Y Y 80% 90% 78,700 - Salva Army: HQ - 439,480 - - Y Y Y Y Y Y Y 95% 95% 21,974 - Shartzer Hitachi Data Systems - 192,465 - - y Y Y y y Y N 80% 80% 38,493 - Shore GSK - 104,000 - - Y Y Y Y Y Y Y 70% 90% 10,400 - Salva PM RESET (Aviation) - 93,417 - - Y Y Y Y Y Y Y 95% 90% 9,342 - Shore Lowe/Draft - 65,000 - - Y Y Y Y Y Y Y 70% 50% 32,500 - Foster Praxair - 59,000 - - Y Y Y Y Y Y Y 90% 90% 5,900 - Manniso VA Florida Ohio buyer GTSI - 46,125 - - Y Y Y Y Y Y Y 90% 90% 4,613 - Hommes & Process (Fr) CCAIG - 40,000 - - 100%Marcus State of FL - 22,943 - - Y Y Y Y Y Y Y 90% 80% 4,589 - Edginton Intermec - 21,893 - - Y Y Y Y Y Y N 75% 75% 5,473 - Tyre American Express - - 678,000 - Y Y N N Y Y N 40% 40% - 271,200 Wilson Intel - - 310,126 - Y Y N N Y Y N 60% 60% - 186,076 McPartland KPMG - Servers - - 132,600 - Y Y Y N Y Y Y 35% 35% - 46,410 Marcus USG - New project - - 125,000 - y y y y y y N 75% 50% - 62,500 Foster Siemens - - 86,000 - Y Y Y Y Y Y Y 50% 60% - 51,600 Foster Siemens - - 55,000 - Y Y Y Y Y Y Y 50% 60% - 33,000 Boyd La-Z-Boy - - 45,850 - Y Y Y Y Y Y Y 65% 65% - 29,803

Prob AdjustmentsSales Qualifiers

Rep Account

Current Quarter's Forecast

Types of Sales

• Transactional Sales– Mostly consumer goods– Relatively simple transactions

• Consultative sales – Solution based approach– Mostly business to business

• Strategic Alliance– Relationship is crucial– Complex sales

Key Account Management

KAM is an approach which includes developing long term relationships with strategic customers whose needs you understand in depth, and for whom you develop a special offer with a differential advantage over the offers of competitors.

Why Key Account Management

• 80:20 - 20% of customers account for 80% of revenue in most cases. So they need to given special focus by top management.

• Complexity in handling large and global accounts - The size and nature of a customer may require the allocation of a KAM to manage them to ensure satisfaction.

• Life cycle engagement – Customers have cycles, both in terms of business and employees. KAM reduces the likelihood of a solution being removed by a competitor at a later date.

Goals of a KAM

• To keep the engagement with key accounts on an ongoing basis, through all the stages in a sales cycle and also post sales.

• To keep customers feeling ‘glad’ about their relationship including any purchase(s) by ensuring that a state of cognitive consonance dominates,

• To develop a KAM strategy that reflects the different types of approaches that can be used based on time, resources and money available and choose the best approach.

• To negotiate the contracts effectively. • To understand and develop ‘special offers’ that appeals to the

strategic customer. • To learn, understand and exploit the differential advantages at

the beginning of a sales cycle as well as re-enforcing them post sale .

What makes a good KAM

• Someone who is interested in more than a short term sale and one who believes in value of long term relationships.

• Someone who sees the customer as strategic to their own success as well as their own organisation’s.

• A good problem solver who is able to bring a customer always back to a state of ‘glad’ regardless of the issue.

• Someone who can think outside of the immediate environment and project issues the customer is likely to have before they have them and provide solutions to the same.

• A person who is willing to input time and effort without immediate financial compensation.

Key factors governing Key Account Management

Key People

• Two kinds of people – People who can influence decisions being

• Political Influence• Administrative influence• Technical Influence• Operational Influence

– People who carry the authority owing to • Structural – For example seniority • Financial • Contractual

Key Needs

• Two kinds of needs – Rationale for buying

• The functional need that the product/service is going to serve• How does it fit within their existing framework• What will happen if the buyer chooses not to buy

– Emotional motivators• Is the need real or is it just to satisfy some other fancies• What are the aspirations of buyers that product/service will

serve

Key Times

• Understand the timelines/calendar in buying process – Does it align with the end of a Financial year– Is it tied up to the end of a particular project– Is it a date by which they have decided to find a

solution to the problem which necessitates buying

• This understanding helps me to– Forecast my pipeline more effectively– see that all the activities I planned to do inside clients’

account are done well in time.

Key Events

• Physical Sales based activities which I have to perform at customer’s end and reach a conclusion with them – Investigation/Fact finding meetings– Presentations– Response to RFP’s– Solution Discussions– Product/Services demo/POC’s– Commercial discussions/Negotiations

Key Competition

• Two kinds of competition– External Competition

• Companies selling similar products/services• Companies having alternate/substitute to products/services

offered by me

– Internal Competition• From within Clients’ people wanting or not wanting to change

current procedures• From within clients’ people strongly aligned to some

competitor of yours

Key Concerns

• Fears or reservations clients have in terms of committing business to me– Something they are not comfortable with– Not sure it fits within their organisation

• Need to develop an action plan to overcome this– By understanding the underlying causes of concerns– Changing the perception of the client and giving him

comfort

Key Disadvantages

• Need to understand where my product/services are deemed to be weak with respect to – Competition – Needs of customer

• Need to understand how we can compensate for the disadvantages and focus on true values where we are weak– To bring true value– To align to people who matter

So why choose a sales career

• Mobility– Not tied down to a place or industry– Transition is relatively easy

• Plenty of jobs– As long as a business exists, it has to sell– As long as it has to sell, it has to have sales persons

• Independence  – Handling a territory/market gives enough

independence – paves way for leadership roles– Not get stuck in corporate day to day operations

The SW Rule

Some will. Some won’t. So what? Someone else is waiting.

Wrap Up and Q&A