When things begin to go south at American corporations, many fingers get pointed in many directions. Usually the first and longest finger gets pointed toward the sales organization. This is a familiar refrain to anyone who has been in sales or has been employed in sales, sales management, sales support or sales operations. The CEO's phone blows up with calls from shareholders demanding to know why their dividend checks are smaller than are accustomed to. They insinuate that if this continues they may need to find a Chief Executive Officer who can deliver the elevated stock price to keep the dividend checks stable. He call his Chief Operations Officer.
Things aren't looking good. The quarter just passed was dismal and the quarter just prior to that wasn't quite up to par either. You know that the fastest, sure-fire way to get the shareholders off your back is to increase sales. When you increase sales, you increase profits. Increased profits means happy shareholders. Happy shareholders means no one threatening your five year stock-option payout. Telling your shareholders that times are tough and that they may need to get used to getting by with less is not the path to continued access to the executive underground parking space and elevator you've become so fond of. Questions would be asked. Why didn't you see this coming? Why didn't you diversify? Why didn't you modernize? Why didn't you acquire other companies to quickly open up other revenue paths? Why haven't we globalized our business strategy?
The COO picks up the phone and dials Senior Vice President of Sales, who in turn schedules a Thursday-Sunday retreat at The Greenbrier with all of the Regional Vice President's to discuss what the issues are that are keeping the company from performing as it once had. The Senior VP wants to know so he can report back to the CEO & COO that he's identified the problem and is on top of correcting it. He knows that the problem can't lie with the Regional VP's. He hired each one of them himself, even bringing a couple of them over from the firm he was with before. If they were the problem it would actually be an indictment of the Senior VP's ability to pick strong leaders to push the company along and lead the sales effort.
The Regional VP's are unanimous in their analysis of the problem of falling sales numbers. The problem isn't with the Regional Directors that report to the Regional Vice Presidents. Those men and women were put into their positions by the Regional VP's themselves. They had been successful front line sales managers with long track records of success. It can't be them that are causing the problem. The real issue they say, is due to the fact that the people who the Regional Directors hired to replace them have made poor choices in hiring. In other words, the Regional Sales Managers that report to the Regional Directors lack the ability to hire top quality sales people. They've put people in front of the company's best customers who don't have the ability to sell them more of the company's products or to convince their competitors customers to do business with our company instead. In order to bolster their assertion that it's the company's front line sales people who are ultimately blame they solicit kindred spirits from elsewhere in the company. The Director of Human Resources affirms that the dropoff in sales isn't because the company doesn't offer a competitive salary and benefits package or that the compensation plan has been "tweaked" each year. Such a statement as that would mean that Human Resources shared in the culpability of the company's poor performance. Additionally, the Director of Training & Development adds that the poor performance certainly isn't attributable to deficiencies in the training program for its sales people. Despite the fact that the former six week comprehensive sales training course has now been reduced to a three day meet and greet, class photo, IT credentialing seminar, HR forms presentation and workshop on the new book on sales philosophy and process that the company's CEO wrote, the training and on boarding for new hires has never been better. HR and Training both corroborate the Regional Director's assessment; it's the sales people's fault.
And after all, don't they deserve the blame? They show up at the office when they want to, work from home when they want to, get to travel to other cities and stay in hotels and eat out and go on exotic trips to Aruba and Cabo San Lucas and St. Barts. They make way too much money and all they really do is go out and talk to people and ask them a few questions.
So how do you recognize when this has happened at your company? Well, thankfully there are some telltale sign to look for.
1. Are the sales people in your organization treated as pariah's and outcasts?
This is a prime indicator. In a healthy organization, sales is recognized as the hunting arm of the company that goes out and brings in the dollars that fund everything else that goes on. If the sales representatives and front line sales managers in your company suddenly feel like second-class citizens, you probably are. All companies walk in the shadows of the leadership. If the executives in the company believe that their sales people are overpaid, coddled renegades and rogues the rest of the organization will follow suit. It doesn't take long for the poison to circulate through the veins of the organization and infect the whole company with an us vs. them mentality. Ask yourself this question; Who has the most clout in my company? The SVP of Finance? The SVP of Legal? The SVP of Human Resources? Or the SVP of Sales? If it's anyone but the SVP of Sales you have a problem.
2. Has the company microscope been taken off the shelf?
Metrics. That's the buzzword of the underperforming company. Not that all companies don't have benchmarks and use statistical data to measure their year over year success. They do. What I'm referring to here is the microscopic measurement of every aspect of the sales cycle. Does every phone call to every customer get logged in ACT or Gold Mine or SalesForce? Is there a recap required to every voicemail left? Do you have to log a four page debrief for every sales call you made? Do you have graphs and charts and dashboards that show how each sales rep measures up in number of voicemail messages left on Wednesdays as compared to the company mean and year over year data from 2010? It didn't use to be like this in the old days, you say? No, it probably didn't. But if it's like this where you work then chances are the scenario above, or at least a reasonable facsimile thereof has occurred. The executive team wants tangible proof to show shareholders that they are doing something to remedy the situation, taking action and seizing the bull by the horns. What does he tell them? That he's had an All Hands On Deck conference call and asked everyone to bear down and try harder and that they all agreed? No. The CEO needs data. He or She needs charts, graphs and spreadsheets. He or she needs to show that he or she is man (or woman) of action, that a top to bottom investigation has been conducted, a scapegoat has been identified and that the scapegoats have been placed on a Performance Improvement Plan. They have signed a document attesting to their underperformance, promising to work harder and agreeing to a strict set of monitoring by management and HR, including regular conference calls and field ride-alongs.
3. Has Your Communication With Your Supervisor Suddenly Become Email-centric?
It's not difficult to understand that sales people, and sales managers by extension, are verbal creatures. They like to talk. They are good at talking. They make their living by talking to people. So what is to be made of it when your normally gregarious sales manager starts communicating with you predominantly via email? You can probably figure that he or she has been told to. Email provides advantages over a phone or an in person conversation. You can always deny that you said something when the contents of a conversation are discussed. No one can deny that an email was written or that it contains what it contains. Chances are that if your sales manager has recently switched to an email-centric brand of communicating with you, it's not by his or her choice. Human Resources has most likely instructed the manager to carefully document all discussions with you in the even that they need to be reproduced. What are they doing this for? In all likelihood they are preparing to terminate you or a entire group including you, or they are at least planning on firing a sub-group of your peers. Most likely, if you're getting the email treatment you're in the mix somewhere. Human Resources doesn't exist to protect the employee from the company. It exists to protect the company from the employee. In other words, they want to be absolutely certain that they've put it in writing that you've had a certifiable history of underperformance and that you've been warned on multiple occasions about it and that they've made efforts to assist you in addressing the performance deficiency. That way when you take your notes and emails to a plaintiffs attorney and tell him or her that you suspect that you've been fired because of your race, sex or age, they can show that it was because of your performance. At least it appears that way.
Another sure fire sign is if the phone calls that you do have with your supervisor become memorialized in an email to you soon after the call. If this is the case your Human Resources department has instructed your supervisor to write down the points of discussion on the call and then email it to you for "your review." Of course, the email is not for your review at all. It's to set the narrative for what took place on the call. If you don't write back and dispute that various things were or were not said during the call then the memorialization stands as a pretty strong testament to what took place. Most employees don't like to take an adversarial position with their supervisor, so this is a very effective tool.
4. Is HR Attending Your Meetings?
If your organization is like most, you will have probably have a quarterly or at least bi-annual meeting of your team. If the attendees at these gatherings have classically been just your supervisor and the team members you might find it odd when your boss announces that you have a "special guest" this quarter; Kate from HR. Should you find it odd that Kate has flown all the way from the company headquarters in Dallas to your little meeting in Atlanta? Yes, you should. Kate will probably give a five or six minute presentation on why you shouldn't use racial epithets or stereotypes in jokes or speech at work. Realizing that this isn't 1972, you become suspicious of why she's really there. You probably should be. Chances are that one or more of your team are being considered for termination and Kate is there to report back on what kind of corporate citizens she's found among your group.
5. Expenses
Way back at the beginning of the article our CEO picked up his phone and put in a call to the Chief Operations Officer that set off the string of events that we've just discussed. That was a grave mistake. The first call he should have made was to the Chief Financial Officer, the CFO. (We are assuming that the CEO didn't have the hutzpah to tell his shareholders that the company was holding its own in a tough competitive and economic environment and if they really thought they could do better they should let him know ASAP because there are many other companies out there that need real leaders at the top who aren't afraid to be plain spoken and straight talking and that he could have his resignation written in less than fifteen minutes if needed. There are precious few of these CEO's out there any longer) The call to the CFO should have included the admonition to go to a corporate-wide moratorium on non-sales related travel and a top down review of how sales related travel could be reduced by 20-25% for the rest of the year.
Let's say that the company has a profit margin of 10%. If they're really fortunate they might have a margin of 20%. If they're in an elite class they might have a margin of 30%. So by looking like a man of action and rattling the corporate cage to increase sales, our CEO really isn't doing much to improve the situation. If sales go up by $1 million dollars you've really only added $100,000-$300,000 to the top line. However, if he'd cut expenses like that retreat at The Greenbrier in favor a conference call or video conference he would realize 100% of the savings from the bottom line. Cutting expenses isn't a very sexy way to assert your leadership. It's better to be known as the guy who can move the sales needle rather than the guy who can make you profitable through cost-cutting.
If your expenses reports are being nit-picked like never before you can bet that there is a good reason behind it. The company is probably is deep Kim-chi and cutbacks are being seriously considered. If you're seeing the effects, your department and your job is probably being considered for elimination. Let's face it. If it comes between canceling their own four day retreat at The Greenbrier or sacrificing you and four or five of your buddies, what do you really think they're going to do?
It's not all bad news, though. If you see some or all of these things happening at your company you always have the ultimate action in your own hands. You can update your resume, start interviewing and jump off of the sinking ship before any of the wharf rats even realize that you're gone.
Stephen Walker writes blog articles on a wide range of topics. He is a novelist and short story fiction writer who writes for the Erudite Aardvark and other online concerns. He can be reached at stephen.walker@eruditeaardvark.com.
This article is the intellectual property of The Erudite Aardvark, which reserves all rights to the content. It may not be copied or re-transmitted in any fashion without the express, written permission of the owner.
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