Developer’s Guide to Running Sales

Teams…

Jeff SzczepanskiChief Operating Officer

http://developingsales.com

Common Startup Plan

1.Idea!2.Technical Co-Founders3.Raise Money4.Build Great Product5.Hire VP of Sales

ie: ‘Needz Sales’

6.Profit!!

Common Startup Outcome

1.Idea!2.Technical Co-Founders3.Raise Money4.Build Product5.While( Cash Remains )

Hire VP of Sales<some stuff happens>Wait 12 to 18 monthsFire VP of Sales

6.FAIL!

Common Startup Outcome

1.Idea!2.Technical Co-Founders3.Raise Money4.Build Product5.While( Cash Remains )

Hire VP of Sales<stuff happens>Wait 12 to 18 monthsFire VP of Sales

6.FAIL!

Add More Features!!?

Best Way to Increase Sales???

Add More Features!!?

Best Way to Increase Sales???

No, it’s cheating because it expands your addressable market, it doesn’t increase actual rate of penetration.

Good sales execution is what sits between your Product

and a Great Business

Product Sales Execution

GreatBusiness

Building Sales Orgs in 3 Phases

Proving Product Value

Understanding your Pitch

Scaling the organization

Essence of Phase 1

Proving a Market Exists for your Product and that people will pay

money for it.

???

Phase 1 Goal

Several paid customers who are getting value out of the product

???

Phase 1 -> Challenge

Your Product Really, Really

Stinks

Phase 1 -> Implication

Customers are buying into your vision more than your product

Phase 1 -> Activities

• Product is rapidly evolving• Founders need to be out there

selling and proving the vision

Key Point: Professional Sales People Not Needed (nor desired) in this phase

Phase 1 Best Practices

• Lean Startup Concepts– Getting to Minimum Viable Product

• Founder selling of the vision• Tight Feedback Loops without Filters• Talk to BUYERS, not just Users– all the personas in the value chain

• No Free Stuff: Prove Value• Test your Pricing

Phase 2

Proving Product Value

Understanding your Pitch

Scaling the organization

Phase 2 Entry Foundations

• A product that is proving useful– Doesn’t completely suck anymore– Graduating from beta phases

• Multiple Paying Customers– People Have paid real money

• Lists of Possible Future Customers• Good sense of a Workable Price Point

Goal of Phase 2

Multiple Sales Reps Closing Deals on their Own

Phase 2: Sales Rep Hiring Profile

• Not their first Sales Job– Proven ability to sell something– At least modestly consciously competent– Smart, Hungary, buy into your vision– Genuinely like solving problems

• BUT Avoid Very Experienced Reps– Expect to make tons of money immediately– Expect too much from the product– Preconceived notions on how to sell product

Common Phase 2 Problem

FOUNDER: “I can close customers myself without any problem, but the reps I’ve hired can’t close the

deals on their own”

Common Phase 2 Problem

SALES REP: “I can’t close customer X without feature Y”

andSALES REP: “If I had Feature A, then I could

sell way more”

Phase 2 Best Practices

• You product will always suck to some extent– Admit it to yourself, Admit it to the Sales Reps– Sell what you have

• Get to at least 3 Sales Reps as fast as possible– You want multiple petri dishes

• Aggressive Compensation Plan– Want successful reps making a ton of money

• Fight all urges to use discounts to close deals• Sales Manager not Needed yet– But a good idea to be looking!!

Phase 3

Proving Product Value

Understanding your Pitch

Scaling the organization

Phase 3 Entry Foundations

• Multiple Self Sufficient Reps Closing Deals• Happy Reps Making good money• Lots of Positive Testimonials– Product doesn’t totally stink anymore

• Lots of Paying Customers– Repeat business

• Lots of Identifiable Prospects to Attack

Phase 3 Goal

Jetting to your vacation home in Aspen, Colorado

Phase 3 Goal

Predictable Revenue that

is Scaling

Phase 3 Concepts

Must Read Book!!

(But ignore half of it)

Phase 3 Bad News

• Nature of Sales is Changing Rapidly• Classic Management Methods Failing• Experience != Expertise• Poor at Predictions of Outcomes• Seemingly More Art than Science• No Magical Processes to Follow

Phase 3 Bad News

• Nature of Sales is Changing Rapidly• Classic Management Methods Failing• Experience != Expertise• Poor at Predictions of Outcomes• Seemingly More Art than Science• No Magical Processes to Follow

Good!

Just Like Software Development!!

Phase 3 Scaling Solution

What if we put an experiencedCTO/VP of Engineeringin charge of Sales!!??

Joel Spolsky did!

WTF – Does that really help?

Phase 3 Insight

Good Sales Management

approaches parallel Good Software Development approaches!!

Properties of Successful Software Development

Smart and Gets Things Done

Empowered Autonomous Individual Contributors

Understand Performance != Results

Software Development• Discovering, Developing and

Finalizing Requirements• System Architecture, Design

and Code Construction• Quality Control including

effective testing and validation

• Task Estimation and Project Management

• Deployment and Ongoing Maintenance

A bunch of Separable Skills that individuals

and the team must be process capable of

Phase 3: Skills Development

Software Development• Discovering, Developing and

Finalizing Requirements• System Architecture, Design

and Code Construction• Quality Control including

effective testing and validation• Task Estimation and Project

Management• Deployment and Ongoing

Maintenance• Team Morale and Cadence

Sales Development• Prospecting• Questioning• Proposal Development and

Pitching• Objection Handling• Closing Skills• Negotiation• Time and Pipeline

Management• Team Morale and Cadence

Team Morale and Cadence

• Bottom Up Schedule Estimates• Strive for Continuous and Steady Output– Team Goals but No death marches

• Using Peer and Social Pressure vs. Edicts– Setting Cultural Norms and Expectations

• Compensation Fairness• Merit not tenure based Advancement

Phase 3 Sales Rep Role

Same as Phase 2 Rep!!

….but you can loosen up the constraints a little

…this is just like on your dev team as it grows.

Phase 3 Sales Rep

Each Rep runs their Own Small Business:• End to End ownership of the relationships• Sets their Own Forecasts• Picks their Own Accounts• No scripts, No quotas• Works under shared best practices• Supported by Team Leader and Sales Manager

Phase 3 Sales Manager

• This is the Line Manager of the Sales Reps– Parallel to the Engineering Manager

• Primary Responsibility is Skills Development• Removes Operational Barriers– Helps define and build common infrastructure

• Works with a Longer Term Horizon– More Quarter to Quarter than Day to Day

• Tends to Specialize as you Grow– Splits into Operational Aspects and Skills Development

Aspects

Phase 3 Team Lead

• Drives Cadence and Morale of the Team• Parallel to the Technical Team Dev Leads• Walking Personification of Ideal Sales Rep• Natural Leaders that enjoy Mentoring• Player and a Coach -> Carries full account load• Eyes and Ears for Sales Management– Spot treatments not skills development

Phase 3 Role Separation

Team Leaders => Track Racing Pit CrewSales Management => Garage Mechanics

Phase 3 Tools and Process

SCRUM Sprint Based Process• Team Based & driven by the Team Leads• Operated as Joint Retrospective and Standup• Breaks Monthly or Quarter Forecasting Cycles

into Week Long Sprints• Reinforces Team Work and Shared Best

Practices• Friendly competition between Teams and

Offices

Phase 3 Tools and Process

Phase 3 Tools and Process

Phase 3 Tools And Process

Phase 3 Tools and Process

Phase 3 Goal

Predictable Revenue that

is Scaling

Phase 3 Best Practices

• First Phase with Professional Sales Manager(s)• Separate Performance from Results• Developing Suites of Skills in Each Rep• Empower the Reps and Teams to Self Manage• Each rep is running their own little business• Real Time information: No Static Reporting

• PS: All Current CRM Systems Suck!!!

• Autonomy and empowerment is the name of the game

REMEMBER: Compensation System is a way to Reward people. It is NOT a Management Tool.

Thank you!!!

talljeff@stackoverflow.com

@inscitekjeff

Blog: DevelopingSales.com