Sales Growth: Five Proven Strategies from the World's Sales Leaders
Finding growth today can be an enormous challenge for companies in a complex and fast-changing business environment. There are no simple solutions, but in Sales Growth, experts from McKinsey & Company provide a practical blue-print for achieving this goal by revealing what world-class sales executives are doing right now to find growth and capture itas well as how they are creating the capabilities to keep growing in the future.
Broken down into five overarching strategies, this book focuses on the valuable lessons that power growth, including how to get ahead of the competition by taking advantage of trends and turning complex analysis into simple guidelines that sales reps on your front line need to sell better. Page by page, you'll learn how successful sales executives find untapped pockets of growth, act like locals to make the most of emerging markets opportunities, and power growth through digital sales. You'll also discover what it takes to find big growth in big data, develop the right "sales DNA" in your organization, and improve channel performance.
- Based on interviews of more than 120 of today's most successful global sales leaders, from a wide array of B2C and B2B organizations
- Offers real-life examples of how successful sales leaders overcame the challenges encountered in the quest for growth
- Contains insights on finding growth before your competitors, optimizing sales operations and technology, developing sales talent and capabilities, and much more
Created by sales executives for sales executives, this book will provide you with the practical guidelines and useful insights to drive sales growth today and in the future.
STRATEGY 1 FIND GROWTH BEFORE YOUR COMPETITORS DO 1
The best sales leaders drive growth for their companies. They use data and insights to anticipate market momentum and pinpoint where untapped potential lies. They steal the march on competitors and lock in new customers first.
CHAPTER 1 Look 10 Quarters Ahead 3
Insights from economic, technological, and behavioral megatrends translate into opportunities at the front line. The best sales leaders invest ahead of emerging demand and cultivate demand for products that won’t be available for years. Peering into the future and harnessing tomorrow’s trends is a job for sales leaders, not just visionary CEOs.
Interview: William J. Teuber, Jr., EMC 14
CHAPTER 2 Mine Growth beneath the Surface 17
Averages are misleading. Take a microscope to existing markets and see the opportunities that competitors routinely overlook. Drill down to the zip code level or look at customer segments by industry or demographic characteristics to reveal untapped pockets of growth. Then turn the analysis into a simple message for the front line.
Interview: Alejandro Munoz, Pioneer Hi-Bred 28
CHAPTER 3 Find Big Growth in Big Data 31
The explosion of big data (such as customer behavior or social media chatter) opens up amazing sales opportunities. This is rocket science, but if you’re left behind, you’ll miss outperhaps for good. Retailers could boost operating margins by up to 25 percent, and all kinds of companies could follow suit if they build insights from a wide array of internal and external data sources and create tailored selling propositions based on personalization. But to maximize the benefi ts of big data, it needs to be at the very heart of the sales culture.
Interview: Shashi Upadhyay, Lattice Engines 45
STRATEGY 2 SELL THE WAY YOUR CUSTOMERS WANT 49
Sophisticated customers are not interested in traditional sales models. They demand faster, more seamless, and even enjoyable sales experiences; they want more information and more value, and they want it now. Delivering all this is hard enoughdoing so profi tably in both mature and emerging markets is a major challenge. Leading sales organizations are fi nding ways to improve digital, direct, and indirect channel performance, and are cracking the code of how to integrate them.
CHAPTER 4 Master Multichannel Sales 51
No company can compete today using only a single sales channel. But with so many channels to manage, how can you ensure consistency, maintain close contact with customers, and raise profitability? The best sales leaders blend remote and fi eld sales, integrate online and offl ine channels, orchestrate direct and indirect sales teams, and even use service as a sales channel.
Interview: Gregory Lee, Samsung 62
CHAPTER 5 Power Growth through Digital Sales 65
You have a website, but can your company really claim to be cutting edge with its digital strategy? The most forward-thinking organizations see sales fi gures and conversion rates skyrocket when they get online and mobile platforms right. They test and tweak constantly to delight the customer and turn clicks into sales. They embrace social media and understand that buzz is only valuable if it hits the bottom line. Finally, they recognize that digital cannot stand aloneit is seamless integration with other channels that wins the day.
Interview: Margo Georgiadis, Google 81
CHAPTER 6 Innovate Direct Sales 85
When did you last change your direct sales approach? Leaders of the most successful direct sales forces have done just that. They now engage customers earlyoften before any sales pitchfor example, by putting customers in touch with the experts who will infl uence their decisions. Even for the biggest suppliers in the most highly developed markets, there are always new ways for hunters to land new customers.
Interview: Jan Geldmacher, Vodafone 95
CHAPTER 7 Invest in Partners for Mutual Profit 99
Often a partner is the best or only way to reach the fastestgrowing markets, but the partner relationship can be fraught. The winning approach is simple: treat partners as an extension of the sales force, help them with their bottom lines, and set clear guidelines for channel confl ict. Companies that master the challenge improve channel revenues by 10 to 20 percent and cut cost of sales by 5 to 10 percent.
Interview: Stu L. Levenick, Caterpillar 110
CHAPTER 8 Sell Like a Local in Emerging Markets 113
Fast-growing emerging economies present huge sales opportunities, but successful sales organizations don’t rush in. They balance the need for speed with a nuanced understanding of the specifi c local market; they overinvest in fi nding the right partners to spare a lot of grief later on; and they think bigbuilding up sales capacity well in advance of needing it.
Interview: Mikhail Gerchuk, VimpelCom 127
STRATEGY 3 SOUP UP YOUR SALES ENGINE 131
Sales leaders can’t deliver growth or optimize channels by waving a magic wand. No frontline effort can succeed without the right back-offi ce capabilities. An effi cient and effective sales support operation is critically important for supporting both the direct sales force and channel partners.
CHAPTER 9 Tune Sales Operations for Growth 133
Sales operations not only represent a huge opportunity for cost improvement (reducing back-offi ce costs by 20 to 30 percent is not unusual), they are also an important contributor to customer experience, and sales force and channel effectiveness. An effective back office can boost revenues by 10 to 25 percent by giving frontline sales teams 50 percent more time to sell. Customers, meanwhile, love the smoother fulfi llment and faster turnaround time.
Interview: Alain Raes, SWIFT 143
CHAPTER 10 Build a Technological Advantage in Sales 147
Sales technology continues to evolve, but companies must ensure that it enables success instead of gathering dust in a metaphorical backroom. Technology helps sales leaders pull ahead of their peers, arming account managers with killer insights or improving better integration with channel partners. It requires investment, but the top companies understand the benefi ts, and they focus on acquiring the right analytical tools and talent so that technology delivers the high returns it promises.
Interview: Frank van Veenendaal, salesforce.com 157
STRATEGY 4 FOCUS ON YOUR PEOPLE 161
Sales leaders can have all the market analysis, all the multichannel processes, and all the technological wizardry available, but without investing substantially in the right talent, they will achieve little.
CHAPTER 11 Manage Performance for Growth 163
Performance management is the bedrock of many sales organizations, especially as performance varies more in sales than in other functions. The best management invests enormous energy in this fi eld and can see close rates rocket by 25 percent, higher customer satisfaction ratings, and up to 30 percent higher contract values. To achieve this, they coach rookies into stars, set the right tempo for reporting and intervention, and know motivation goes deeper than money.
Interview: Mario Weiss, Würth 175
CHAPTER 12 Build Sales DNA 177
Achieving excellence in sales for six months is great, embedding it in the genes of the organization is better. World-class companies create a culture fi t for the long term. They give middle managers a starring role as agents of change, and they focus on creating crack teams, going beyond individuals’ skills to build institutional capabilities.
Interview: Ludwig Willisch, BMW 188
STRATEGY 5 LEAD SALES GROWTH 191
It’s time to think about accelerating sales growth in your own company. Sales leaders need ambition, determination, and the persuasive skills to bring both the board and the front line with them on what can be a challenging, but extremely rewarding journey.
CHAPTER 13 Drive Growth from the Very Top 193
Sales leaders know they themselves must be at the vanguard of change. Without strong leadership any growth program will fl ounder. Best-practice leaders challenge the status quo, they galvanize their team, they model change, and they demand results above and beyond everything else.
Interview: Hubert Patricot, Coca-Cola Enterprises 199
CHAPTER 14 Make It Happen 201
The preceding chapters are rich with ideas, examples, case studies, and interviews with leading sales practitioners. Now it’s over to you. For sales leaders determined to drive change and seek the sales growth on offer, we have a selfassessment guide and some benchmarks to get you started. Stakeholder alignment is essential, as is a clear vision of how to prioritize the transformation effort. Only 30 percent of change programs succeedensure yours is one of those that make the grade.
Interview: Huw Tippett, Novartis 220
Sales Growth Online 227
About the Authors 229
Thomas Baumgartner is a partner in McKinsey & Company's Vienna office. He co-leads McKinsey's work on sales and channels globally. Baumgartner advises clients in industries including high-tech, electronics, transportation, basic materials, telecommunications, and consumer goodswhere he helps them outline and drive large-scale, top-line growth programs.
Homayoun Hatami is a partner in McKinsey & Company's Paris office. He co-leads McKinsey's work on sales growth. Hatami has a broad range of experience working with high-tech and telecommunications clients in Europe, the United States, and Asia.
Jon Vander Ark is a partner in McKinsey & Company's Detroit office. He co-leads McKinsey's work on sales growth. He has deep expertise in sales and channel management across industries including travel, automotive, industrial, and consumer durables.
Sales Growth belongs in the selling-as-science school. The book argues that data, process management and outsourcing can do as much for sales departments as for other areas of the corporation. Companies should create sales ‘factories’ where sales teams are ministered to by support people from other disciplines, and equip them with computing devices rather than briefcases. This book, which finally gives the field some proper attention, is long overdue."The Economist "Can the Dubious Art of Selling Become More Scientific?" (Book Review, April 6, 2012)"Reading this book is like walking into a room where more than a hundred of the world’s sales leaders are openly sharing their perspectives. Sales Growth puts sales management back where it belongs: at the center of management thinking about what makes business successful."
MARC BENIOFF, Chairman and CEO, salesforce.com
"If timing is everything, then Sales Growth has it made. We are at an inflection point where massive changes in technology and customer behavior point to growth opportunities. This book provides a critical blueprint for bridging those opportunitiesboth those in future and right in front of us."
RICHARD KELLAM, Global Chief Customer Officer, Mars
"This book is a must read for sales executives in emerging markets. The research and practical ideas clearly spell out how to create a global sales strategy with a local edge."
RICARDO VILLELA MARINO, CEO, Itaú Latin America, Board Member, Itaú Unibanco
"Sales Growth shares wisdom that successful sales leaders have cultivated to create greater value for their customers and their companies. It offers a compelling set of case examples that combine the art of selling with true analytical rigor and operational know-how."
GERHARD GSCHWANDTNER, CEO, Selling Power magazine
"Improving sales performance with methods and tools is a must. A refreshing change beyond the common focus on back office and operational excellence. This book is fact based and takes a unique customer perspective. I have no doubt that the practical insights laid out here lead to sales growth."
MICHEL CROCHON, Executive Vice-President, Schneider Electric
"Sales Growth is essential reading for business leaders and MBA students. It is a thoughtful and practical addition to the discipline of sales management. Using timely stories and provocative anecdotes, the authors provide executives with an important and accessible book."
DAVID SCHMITTLEIN, John C. Head III Dean, MIT Sloan School of Management