The Changing Nature of Sales

Posted by: Matthew Boyle on September 14

Salespeople are an eternally optimistic lot, but their sunny disposition has been sorely tested over the past year. A new survey from Watson Wyatt, though, suggests that some of that swagger is returning.

The survey of sales executives at 129 large companies found that the vast majority expect revenue growth in 2010, with nearly half of that group forecasting growth og 6% or more.

A small but significant portion of those surveyed expect to beef up their sales force in anticipation of better days ahead. Still, the 16% of firms adding salespeople was nearly matched by the 12% who expect to cut their sales force in the upcoming fiscal year.

Those salespeople who remain will face a different environment and expectations, the survey found. Over half of those polled expect to change their sales performance measures. While historically sales teams have largely been assessed on “pure sales” metrics like revenue and volume, many companies are now taking the opportunity to shift to a more sophisticated set of measures that includes customer profitability, customer retention, and lead conversion rates. Companies are also shifting their focus to assess whether each and every customer is worth the risk.

“With budgets still tight, many companies will look to get more out of their current salespeople for next year and to align incentives with changing business objectives,” said John Bremen, Watson Wyatt’s global director of sales effectiveness and compensation.

Surprisingly, while one-third of firms trimmed their sales goals and quotas over the past year in the face of slowing business prospects - in other words, they lowered the bar - over half could not even meet those reduced expectations. That shows how difficult business forecasting has been since the Lehman Bros. bankruptcy exactly one year ago.

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