Managing Value, Part 6: Sales

I have been spending time thinking about adding value to business processes that have impact on the final product or service. The “Value Chain” encompasses the entire set of business processes from acquiring resources to delivering the end product. This series of blog posts explores how your business could change if it was deliberately managed in such a way as to maximize the value at each link on the value chain. The focus of this blog entry is Sales.

Sales

There are many ways to organize a sales function. Companies can have an inside sales force, an outside sales force, a dealer network, retail stores, e-commerce sales, or any combination of the above. There are also many ways to align the sales function. For example, the sales team could be segmented by geographic territory, by product line, by industry vertical, or even by customer size. All of the management decisions around configuring sales have an impact on sales, and ultimately, the company. These management decisions even have the potential to add value to the sales process.

I believe there are two specific areas where sales can truly add value: product knowledge and customer relationship management. Think about your past experiences working with a salesperson - buying anything from a new car, to a new cell phone, to a new grill. Could your sales person talk intelligently about the product? Could they answer your questions and make recommendations based on the needs you communicated? I’m not talking about a fast-talking, hard-closing sales person. I am talking about a sales person who is confident in their sales ability and knowledge of the products and combines that with a genuine concern that the customer gets the right product for their needs. This style of sales truly adds value to the process.

Managing the relationship with the customer is my second "value add" for sales. The best kind of customer relationship in business is a long-term, satisfied, repeat customer that happily makes word of mouth referrals. We have all heard the saying, "The customer is always right." I prefer to say, "Always treat the customer with respect, and help them to be right by combining product knowledge, customer knowledge and best practice expertise." In the service industry, we call this consultative sales. Managing and documenting customer communication is a large part of this process. Knowing the customer well enough to understand their business needs and buying cycle is important, and this knowledge can close the loop on any product issues that need to be corrected. Sales can play a valuable role in giving the engineering and production teams the feedback they need to improve the product. This kind of customer relationship facilitates up-selling and cross-selling with the existing customer and lends itself to natural new sales through referrals.

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