When to Ramp Up the Sales Force
Early stage companies often start ramping up sales as soon at the product is out of development. The product is ready and it’s time to sell. You hire experienced sales guys. As many as you can. The deals don’t close as quickly as expected. You are burning through cash. It must be the sales guys. Somehow the wrong guys were hired. It couldn’t possibly be the product. Fire them and get new sales guys.
Many of you reading this will probably have at least one experience in your career to relate to this scenario. I’ve recently read a paper titled "The Sales Learning Curve" by Mark Leslie and Charles Holloway. Their hypothesis is that like manufacturing, sales must go through a sales learning curve to work out the kinks and shortcomings in the product, and to understand the most effective methods to sell the product. Once that happens then it’s time to ramp up sales. More importantly there’s no way to shorten the learning curve. It varies in duration from company to company and it happens organically.
During the Sales Learning Curve your team will go through the process of learning how to acquire customers, what customers want in the product and the sales tactics that work. Once you’ve been through the learning curve you can confidently begin ramping sales.
This process unfolds in three phases, each requiring a different size sales force that have different skills:
Initiation Phase - completion of beta testing and have few prospects. Hire a few salespeople to learn how customers will use your product and to help other people in the organization refine the product offering. These salespeople must be good communicators, tolerate ambiguity, have a deep interest in your technology, and can make their own sales models and tools.
Transition Phase - a critical mass of customers is acquired and sales are accelerating. Keep the initial sales team focused on learning. Now add salespeople who can operate within an evolving sales model, but don’t need to have the analytical and communication skills of the initial sales team.
Execution Phase - you’ve developed the formula for sales success. Hire traditional salespeople and give them a territory, sales plan, marketing materials and price book.
The trick is knowing when you’ve transitioned from one phase to the next, and The Sales Learning Curve offers methods to identify when transitions are occurring.
If you are in a startup and feeling the pressure to add salespeople quickly, read the The Sales Learning Curve today. It could mean the difference between success and failure.
Looking for the latest in product and data science? Get our articles, webinars and podcasts.