Finding the Right Sales Leader When Times Are Tough

By Lee Esler

These have been tough times, especially for those executives charged with generating revenue. Over the last nine months, many companies have been removing and replacing the lead sales executive—be it the senior vice president of sales for a mid-sized company, a regional sales manager for a multinational or, in some cases, the COO of a startup—because the revenue numbers are not meeting expectations. I can recount many sad stories of successful sales leaders jumping to startups during the tech boom, only to discover it was a bad fit for both parties. Many of the executives were beyond adept at managing a sales force of hundreds, but they were unable to tap into the necessary skill-sets and, more importantly, mind-sets to succeed at an emerging company. Within less than a year, many of these stellar executives were asked to leave.

While it is easy to point fingers at the poor economy—sales numbers across the board have been down for the last two to three years—the cause of the problem often is a lack of fit between the organization's sales leadership needs and the strengths of the person it selects. Companies need to assess carefully the type of sales leader they require and seek these individuals out accordingly. Hiring the wrong leader at the sales-executive level carries an expensive price tag. Not only are companies losing money by hiring and training new executives who don't work out, but they are losing money as a result of lost customers and missed opportunities—the most costly missteps of all.

To curb this costly trend, companies need to look beyond the candidate's track record, industry knowledge, relationship assets, personal characteristics and demonstrated leadership skills. While these are important indicators, they do not tell the whole story. Today, to ensure the best sales fit, companies need to understand how the candidate's strategic thinking, functional competence, influence skills and management techniques relate to their particular business situations—scale, complexity and industry life cycle.

One method that I have found to be helpful is a systematic review of the types of available talent. By breaking down the structure of the sales leadership model into four stages, based on the competencies required for each situation, businesses can enhance their likelihood of hiring the right person to drive revenue growth.

Team Leader
Typically, the "team leader" is a lead executive who oversees a small team (less than 10) of direct reports. Most often, this executive is a geography-level sales leader for a large company or an entrepreneur leading an early-stage company. A team leader possesses an almost single-minded focus on completing the deals and is generally a very detail-oriented person. Because the team leader is usually spearheading the selling process, this individual must have deep understanding of the product or service and excellent functional selling skills, a high level of initiative and must enjoy hands-on work. In addition, because this person must possess an entrepreneurial mindset, he must possess a high tolerance for ambiguity while expecting high pay for performance.

Group Leader
The "group leader" manages a larger team, typically 10 to 40 people. This person is often the vice president of sales for an emerging company or a regional vice president of sales for a large multinational. The larger the organization, the greater internal and external complexity involved in managing a sales P&L. There is also a greater demand for strategic thinking, cross-organization collaboration and people development. As niche markets are exploited and distribution and alliance partnerships are formed, strategic business skills become even more important. Typically, this leader is an excellent problem-solver who will stay close to the customers, enjoy the thrill of the sale and require a lot of variety in his/her work. He or she possesses a high results orientation, functional selling skills and a strong penchant for change.

Organization Leader
The "organization leader" usually oversees between 50 and 250 people, often as the national sales vice president for a Fortune 500 company or a worldwide vice president of sales for a mid-sized company. And while there is a decreased reliance of functional selling skills and technical competence, there is an increased demand for superior organizational skills to manage a broad scope of geographies, distribution channels and partners. The breadth of responsibilities also includes managing other functional areas, expanding the profit and loss statement and overseeing outside business partners. An organization leader possesses the ability to team-sell with partners, open new channels of distribution and quickly attract a new team of sales executives, all with the willingness to work in an environment of change. In the end, this strategic thinker is extremely team-oriented with excellent leadership abilities.

Enterprise Leader
The "enterprise leader" is responsible for at least 250 people. Most often, he or she is the executive vice president or senior vice president of global sales for a large multinational in a mature market. The market dynamics now include installed base-selling, industry verticals, large account management and relationship-selling. These leaders can effectively manage both the "farmers" and "hunters" and possess a long-term view when it comes to customer orientation. They expect a high percentage of repeat business. As a result of strong organizational and political skills, the enterprise leader works well within a team-based environment between organizations. At this most senior level, this leader also is responsible for a significant increase in profits and is a key strategic player on the company's executive team.

For some, these four categories appear as a rational career transition, from team leader to enterprise leader. And while this does occur on some levels, it is not uncommon to have senior sales executives stake a claim at one particular level as a result of specific competencies, personal preference and a track record of performance. This is why it is imperative that companies hire sales executives who meet their situational needs. The worst scenario would be to place an enterprise leader into a position in which he or she cannot culturally thrive and that does not promote his or her best qualities, and vice versa with the other levels.

Given this sales leadership structure, it is critical for companies to hire the right sales generators for their particular business situation. By carefully vetting candidates who not only possess a strong track record and skill-sets, but also the specific track record and skill-sets that are relevant to the particular business environment and product/service life cycle, the costly trend of hiring, firing and replacing ineffective sales leaders will begin to wane.

For additional information, consider these AMA seminars:

• National Accounts Management
  
• Recruiting, Interviewing and Selecting Employees
  
• Developing Executive Leadership
  

Author Bio: Atlanta-based Lee Esler is a member of Spencer Stuart's Technology, Communications & Media and Consumer Goods & Services practices. Esler is an experienced executive search and human capital consultant with considerable depth in general management, marketing and sales.