The commercial sales division of a leading U.S. financial services organization failed to meet growth targets for several consecutive periods. This included missing the mark for booking new client accounts as well as the sale of additional products to existing clients (measured as the penetration rate). Similar to their competitors, the organization’s commercial sales unit was structured by geographic region. This meant that teams of sales representatives had business development responsibility for clients in their respective region. The rationale for this design was that personnel focusing on a region would better understand the local business conditions and also would be more responsive than those based outside the region.
Data gathered during the initial phases of the project suggested a possible solution to the sales performance problems. It was discovered that there was a correlation between sales representative expertise in a given industry and product sales in that industry. The logical connection here is pretty obvious (at least in hindsight). A number of business challenges require a minimum level of industry experience just to be recognized, let alone discussed and navigated with potential customers. So, for example, a sales representative with deep expertise in the four-year academic market is more likely to build rapport and provide meaningful advice to potential colleges and universities regardless of where he or she is based. The solution was to re-structure the division by industry groups (more than 20) with sales specialists assigned to one or more teams based on documented knowledge standards for each industry (these were developed to communicate and verify required expertise). This design led to a 15% improvement in YOY sales for the unit in the first year.
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