Before making the decision to downsize, you need to evaluate your sales efforts. Your real problem might just be a lackluster sales strategy.
Do you ever look around your office and ask yourself, “What are all of these people doing?” You look at your sales and revenues and they are flat or below projections. Your payroll, however, is still disproportionately robust. You start to wonder…Do we really need all of these people?
Before you grab a pencil and start plotting how to “right-size” your business, ask yourself a few questions first:
1) How does seasonality and business cycle affect your staff needs?
2) What does the backlog show the demand to be in the near future?
3) What does the pipeline show for the possible demand in the near future?
One of my great mentors once said, “All business problems are really sales problems.” An overstatement perhaps, but it is still something worth considering. Once you have looked at the fluctuations in your staffing demands based upon the questions above, you need to focus on ramping up your sales efforts.
Let me start with a confession–I have made almost all of the staffing mistakes you can make, some of them more than once. I have held onto staff when I should have trimmed. I have trimmed when I should have kept. It took me a while, but eventually I learned the lesson to hire slow and part ways fast when it is clear the relationship isn’t a good fit. Assuming you have done the same, that means you have a really strong staff who are underused. This is not a management problem, a scheduling problem, or a lack of commitment. It is a sales problem.
What to do:
- Examine what’s on the horizon of your sales pipeline–What can be done with your larger clients to accelerate the purchase cycle and implementation? Often you have more influence than you think. By working from the more-distant horizons back to the current moment, you can find opportunities for acceleration.
- Analyze current customers and your account penetration–I am often surprised by the complacency of sales people with their existing accounts. Their fear of losing what they have causes them to not aggressively pursue growth and expansion in an account. This might come from a bad experience in the past. It also comes from a misunderstanding as to who actually owns the account. The sales rep does not own the account, your company does. This means you need to declare the strategy and ensure its execution.
- Take control of the sales calendar–In our work with clients, I will do a calendar-mapping activity with the sales and business development teams. Each person maps out the next 90 days on a big flip chart to indicate where they are going and with whom they are meeting. We then ask them to value the weeks in revenue growth or new client acquisition, week by week. No value is given to account maintenance, nor is any taken away- it’s just not counted. The outcome is surprising. It often shows how little effort is being spent on growing revenue. Using this information to reset the expectations and time investment of your team is a great motivator for bigger numbers faster.
- Drive the account meetings yourself–During sales down cycles, you need to be driving the account reviews of your company’s top customers yourself. It’s not magic that accounts grow when you are in attendance. It’s a projectable outcome. So why did you stop going?
You have solved many of your people problems in building a good team. Now go solve your sales problem. You may not be overstaffed overall, just undersold.