Monday, August 13, 2012

Revenue Series #1: the new sales management two-step

The discussion in media circles continue to revolve around paid content strategies in face of declining ad dollars. Here is the first of an occasional series that is just about advertising, sales management, and what it might take to reverse revenue declines. Today's topic is the dreaded new sales manager:

If there is one story I've heard a hundred times in the past few years it is the one about the new sales manager who comes in and immediately starts handing out outrageous sales quotas leading to the inevitable staff turnover. The strategy generally is considered what young sales managers do in order to clear out the old staff, but it doesn't turn out that way, it simply leads to turnover.

But if performance is the judge, rarely does the new team really outperform the old one. So why do so many sales managers continue to use this tactic?

Its tied, I believe, to the way sales management is brought in.

Recruited and ultimately overpaid management is becoming the norm – not only in tech, but in traditional media, as well. The recruit is clearly the rain maker (God, I hate that term) and is brought in with rave reviews by the recruiter and the candidates themselves. Once hired, the rain maker then is expected bring in the desired results (which are often pipe dreams to begin with).

For many of these newly anointed superstars, changing the company's strategy is not possible – they've been brought in by executive management to implement the existing strategy, not change it. To get hired, the candidate had to show their total buy-in, otherwise another candidate would have been hired. So with strategy off the table the only place to look is with the sales staff.

This is not so different with most other areas of management. Many newly hired executives find it far easier to chop heads than to re-imagine the business and change direction. Heads rolling out the door is the litmus test of the truly serious executive today. If you can't chop fast enough you're not management material. (That's generally why private equity owners prefer to recycle CEOs, they are experienced and chopping heads and making the P&L look a little better, if only for a short while anyways.)

But many new and old media companies are finding that they are simply recycling staff – our new staff was someone else's old staff, after all. Few ad sales pros can stay at a property longer than a few years without facing new sales management, along with the outrageous demands that come along with that change. Surviving new managers is the stuff of late night bar conversations.

How to stop the madness? It all has to start with the CEOs or executive managers doing the hiring.**

Rather than being enamored with the candidate that knows the name of a few media buyers (who are likely to change in the coming months anyways) it is better to discuss how they changed and implemented sales strategies at their previous positions. What problems did they encounter and how did they solve those sales problems in the past? If the answer is strictly limited to staff turnover you know the type of manager you will get. If the answer involves positioning, presentation and product development maybe you are on the right track.

**Unfortunately, many CEOs are brought in without much of a concept of how to change strategy themselves, and all too often resort to the same kinds of behavior seen in new sales management. The other alternative for these new executives is often to outsource as much as possible, calculating that while they are without a clue as to how to solve a problem surely the company brought in will be able to turn things around.