Here ’ s an inconvenient truth : All successful MSPs that are experiencing profitable growth have one thing in common : a productive , well-staffed , growing sales department . If you want to grow your organization , it is a necessary “ evil ” you must invest in . Most MSPs are far too heavily staffed on operations and tech without salespeople , similar to a car with all engine and no gas pedal . For high-growth firms , you ’ ll routinely see 20 %– 40 % of their staff dedicated to sales and selling . But adding more sales “ bodies ” is not the absolute answer either . Your sales department must be ruthlessly managed for profitability and performance . Half of the job is finding the right person , someone who can sell and will sell . If you ’ re not willing to enforce productivity and manage activities , even for “ good ” people , your sales team will end up being a giant time and money suck on your organization .
Larry Schulze , founder of Taylor Business Group ( now retired ), had a great presentation about building a profitable IT services business . In his presentation , he explained how your techs must have a 75 % utilization rate in order for you to make a good profit , which means they are working on billable client projects 30 hours in a 40-hour week , reserving 10 hours a week for everything else ( documentation , traveling to a client ’ s office , staff meetings , etc .). If you ignore this metric — or fail to track it , enforce it , and continuously strive for it — you ’ ll end up being barely profitable or even losing money . He often told the story about a client who discovered that one of his top guys , who he was paying a premium salary to , would routinely go home during the day to mow the lawn , work around the house , or take a nap when he was supposed to be on-site working at a client ’ s office , but the office manager of the client was a friend and would cover for him .
This is not uncommon , and to Schulze ’ s point , you must view all of your employees ’ hours as inventory that you purchased . If they screw around , come in late , go home early , or use any of those hours for playing games or running personal errands , they are stealing paid-for inventory from you . While I don ’ t think any CEO would begrudge a few minutes a day on personal activities , spending hours a day browsing social media , shopping , gambling , and running personal errands is a horrendous violation of professional ethics , and so is going home early and coming in late . Just try not paying an employee for all the hours they worked and see how that goes over . You ’ ll get a not-so-friendly visit from the U . S . Department of Labor .
Now , Let ’ s Consider That Same Concept For A Salesperson
The loss is not just limited to the base salary you are giving them . The real loss is in opportunities : sales that you should have closed but didn ’ t and leads that you paid to produce that should have been followed up with and converted to paying clients but were left abandoned , ignored , and up for competitors to steal . You also must consider bigger-ticket , more complete solutions that should have been sold to the client but weren ’ t even mentioned or presented , costing not only lost sales but also potentially harming the client because they weren ’ t sold everything they need . When you add all of this up , the losses are staggering . So how do you deal with this ?
The First And Most Important Step Is To Stop Accepting Less Than You Should From Your Salespeople
At a minimum , take a hard , pragmatic look at what you ’ re getting from your salespeople as a whole and individually for what you ’ re investing in both time and money . Most MSPs and business owners in general accept and tolerate horrible productivity and low performance , excusing it away because the salesperson is a nice guy and is “ trying .” This is often because they can ’ t find anyone better because they don ’ t want to do the tough job of managing and enforcing quotas and systems , and they don ’ t want to deal with firing and starting over , if necessary .
If you won ’ t do this , you ’ ll never have a high-performing sales team . Not only will the duds gather , dragging you down with them , but the high achievers also won ’ t work for you because of your lazy , soft approach that doesn ’ t allow them to make the money they can get somewhere else .
Second , Manage Using Leading Productivity Measurements
How many prospects do your salespeople need to talk to in order to secure a new opportunity ? Which prospects specifically should they be calling on ? How many opportunities will turn into a paying client ? What does the average client spend with you , and are you continually increasing that number ? Are your salespeople following up , presenting , and closing as you ’ d like them to , or are they winging it , cherry-picking only the easy opportunities , ignoring the “ warm ” leads that need a little work , and sloppily presenting the cheapest , easiest-to-sell products and services ?
As Pearson ’ s law states , anything measured improves , and anything measured and reported back accelerates the rate of improvement . If you want your sales team to perform , they have to track and report upon activities , and you , as a manager , must inspect those activities to ensure they are being done to the quality and quantity you want . Are some salespeople self-managed ? Yes , but they are rare , and even those who are highly motivated benefit from good management .
Want a FREE sales management checklist of the metrics you need to measure and manage in order to maximize the performance of your sales team ? Go online and get it now at MSPSuccessMagazine . com / saleschecklist . n
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