The Four Cornerstones of Revenue Growth
What You Can Do Now to Lay a Solid Foundation
You’ve heard it before. Nothing happens until something sells.
And unless we sell something, we don’t book revenue. Without revenue, there’s no business.
In today’s post, I want to talk about how we build the foundation for revenue growth. And how we install the steel columns and structural beams to sustain it over time.
The most asked question in my business: “What’s the quickest way for me to grow my business?”
A mid-market company engaged me recently in my primary role as a revenue growth consultant. The client had a history of missing budget targets and annual revenue projections. I had four months to get business back on track.
When I signed on, the client was threading only forty percent of budget. The sales manager told the CEO he was confident the company would come in at plan by year end. Two pending deals would push the team over plan.
To the CEO, his head of sales holds only one job─to drive revenue. Top-performing sales leaders understand the essence of revenue growth; it demands the artful coordination of thousands of movements, performed like symphony conductors with their musicians.
But too many sales leaders make it way too difficult.
They rush about pulling levers and making changes to try to get the job done. They leverage data, if lucky enough to have a source, then work diligently to feed it to the pipeline. They practice the fast and furious approach to sales by creating new sales collateral to drive leads, increase upsells, train the team, and improve close ratios. They become obsessed with finding the next big “thing” to take their organization to the next level.
The Four Cornerstones
When I met with the CEO and head of sales, I said:
“Here’s the deal, growing the sales team, adding new sales tools, increasing top of the funnel activity, leveraging inside sales, new marketing campaigns, and the like, may add incrementally to sales revenue for the moment, but they won’t get over the top to meet your annual numbers year in and year out.”
They looked puzzled. I went on:
“To blow out your sales organization and sustainably increase revenue, you must align these four critical cornerstones:
1. Hire the right people
2. Create the right strategy
3. Build the right structure
4. Follow the right sales process.”
These four areas may sound familiar to my readers. However, I cannot tell you how often I deep dive into companies and do not find a semblance of strategic focus around core pillars.
Without specific, measurable objectives and tactics across all four of these areas, your sales team is not optimized to crush revenue growth.
Before we tackle hiring the right people, let’s revisit the overused “right.” It pops up in our vocabularies so often it is losing its meaning. When I use this word, I mean the right people for your culture, those suitable, ideal, and driven to make a difference.
Right strategy means what will lead you to an authoritative position, a precise and unerring path to compete and win business. Right structure means what’s advantageous given your market position and resources. Right sales process means what’s appropriate and expedient for your type of sale, prospect buy cycle and market challenges.
1. Hire the Right People
First, we studied the sales team to verify the right people were in the right positions meeting with the ideal prospects. My client performed no upfront evaluation of new hires. Avoidable mistake.I am a strong believer salespeople must contain the right DNA to sell well. Certain characteristics cannot be overlooked. For years, I’ve relied on the DiSC Profile to evaluate the presence of these key characteristics, or lack thereof.
I am a strong believer salespeople must contain the right DNA to sell well. Certain characteristics cannot be overlooked. For years, I’ve relied on the DiSC Profile to evaluate the presence of these key characteristics, or lack thereof.
We put 22 sales reps through the DiSC profile. The results did not surprise me. Seven of the twenty two were real “hunters”; the balance were “farmers.”The hunters, thought of as ‘the doers,’ aim to close as many deals as fast as possible. They often focus on deal quantity and thrive on exploring new areas. Farmers focus on developing long-term customer relationships and find satisfaction by working with a few customers to create a lasting impact.
The hunters, thought of as ‘the doers,’ aim to close as many deals as fast as possible. They often focus on deal quantity and thrive on exploring new areas. Farmers focus on developing long-term customer relationships and find satisfaction by working with a few customers to create a lasting impact.
Hiring the right members for the sales team is an essential aspect of driving revenue. It is also the most overlooked and the thorniest problem most sales organizations face. If you do not have the right people in the right roles, nothing gets done. Nothing sells. Right people are core to execution.
Using DiSC profiles and our evaluation process, we were able to answer these questions:
- Do we have the right people in the right roles?
- Does the team have the right skill sets?
- Do they have the necessary knowledge to meet customer’s expectations?
- Is the team performing at the level required to be successful?
- Do we have the data to understand what makes our top performers successful?
- Can measure the strength of our team in relationship to our strategy?
- Do we know what skill sets drive success in each of the roles in our organization?
- Have we documented key traits and skills required by our team to crush it?
- Have we measured every team member against these skills and traits?
Because people are unpredictable, hiring the right salespeople is the most difficult to master. Invest sufficient time to do informed hiring. To recover from a hiring mistake costs dearly, consumes precious time, hurts morale, and pushes your revenue goals farther away.
2. Create the Right Strategy
The second cornerstone to revenue growth begins with a clear and powerful sales strategy. What’s your 2017-2018 sales strategy? What’s your go-to-market plan? How do you outpace the competition? What market opportunities or weaknesses are you going to exploit? What new markets are you going to penetrate? What industry changes in your target market can you leverage? Without confident answers to these questions (and more), you’re relegated to selling with blindfolds.
It is nearly impossible to grow revenue without a strategy. Oh, you might move the needle a sliver, but you will not increase revenue. Keep digging, thinking, and analyzing. What opportunities present themselves? Where do latent revenue-generating opportunities hide? Where’s the competition falling short?
Look beyond the obvious. Find out with certainty what’s happening within your current customer base? What market dynamics changed? Look deep, inside and outside of your company to indicators on building the right a competitive strategy. It is at the heart of revenue growth.
3. Build the Right Structure
Your structure holds the framework of your strategy. Without a solid structure, you will be hard-pressed to execute on your strategy. Your structure supports your strategic efforts.
For example, does your strategy require inside or outside sales? Does it require hunters or farmers or do you break up those roles?
Does it require content and new internet strategy? Does it require a different compensation plan? Does it require new territories structure? What does your strategy require to be successful? Your structure needs to answer these questions. And its components include sales operations and sales enablement. Structure powers your strategy to take flight.
4. Follow the Right Sales Process
I am a major advocate for sales processes. If you’re a regular reader, you know this fact. Numerous studies, including CSO Insights’ 2016 Sales Performance Optimization Study, demonstrate how sales organizations who optimize their sales processes to engage and work with clients significantly outsell less adept competitors and achieve many edges in sales performance such as:
- 17 percent improvement in overall revenue plan attainment
- 21 percent increase in percentage of sales reps making quota
- 31 percent increase in win rates of forecast deals
- 43 percent decrease in sales force turnover
Take a long, honest and objective look at your sales processes. Do they align with and enhance the prospect’s buying process or hurt it? Do they accelerate the sale? Your team’s development process? What about your pipeline meeting process, coaching process, lead development process, win/loss assessment process, hiring process and onboarding process? Have you put into place the right processes to deliver more revenue?
Think about supercharging your car. When you implement light, functional, effective processes for sales, it’s like installing a turbocharger on your vintage muscle car. Everything ZOOMS.
You will not grow revenue with a handful of isolated efforts. Rather, revenue growth results from a set of targeted, precise, and aligned objectives across the cornerstones of people, strategy, structure, and process.
If a sales organization fails to deliver sustainable revenue growth, one or more of these areas is out of whack: the wrong people occupy critical roles; the sales strategy isn’t sound; the structure doesn’t support the strategy; and either the wrong processes prevail or there’s no process at all.
If revenue growth is your litmus test for success, download our eBook, Six Ways to Increase Revenue and Build a Standout Sales Team, for additional tips on growing your company’s revenues.
See you on the upside,Bill
For more information, go to www.pleinairestrategies.com
Or call William L. MacDonald in San Diego at PleinAire Strategies LLC at 858.759.8637 or 213.598.4700