By SUSAN LAHEY
Reporter with Silicon Hills News
JT McCormick with Headspring, Nick Friedrich with Facebook and Michael Osborne with Handshakez
Osborne, co-founder and CRO at Handshakez, was vice president of sales for Bazaarvoice in its early days. He was on the panel along with Nick Friedrich, head of SMB Sales and Service for Facebook and JT McCormick, executive vice president of sales and marketing at Headspring. Karl Scheible, president of Market Sense Inc. moderated.
Failing to plan to build a sales staff creates huge problems, the panelists agreed. At one point, Osborne said, Bazaarvoice had to double its sales staff from 10 to 20 people but didn’t have a mechanism for doing that smoothly.
“Going to 20 people doesn’t sound like that much,” he said, “but it’s really difficult. You have to think through all the impacts and set expectations accordingly. The second time around we were very methodical and it worked.”
Two Strikes, You’re Out
Bazaarvoice, he said, developed a system of twos. If it became clear after two days that a sales person wasn’t going to work out, it was the hiring manager’s fault. If the person didn’t work out after two weeks, it just wasn’t a good fit, they couldn’t grasp it fast enough. If someone didn’t work out after two months, there was “something else missing. They may not be able to adapt to the role.” And if someone missed his or her numbers after two quarters, they were out—even if they’d been performing well up to then.
In one case, a salesman had been a top performer for three years but as the company grew and changed, he started missing his numbers. The issue there, Osborne said, was he failed to adapt to the changes.
“You have to move fast when you see performance issues with competency and commitment,” Friedrich said. “When you hire someone, you coach them as much as you can and then cut them fast if you have to make changes. There’s an opportunity cost to having that person in the seat. You could have a rock star in there.”
Sales Stars Come From Unlikely Places
All the panelists agreed that their top sales people might not come from a sales background. They’d hired students, soccer coaches, lawn care professionals. Passion and drive as well as intelligence and a stellar ability to communicate were more important than sales experience.
“We look for proactive folks with an appetite who were driving change in their previous roles,” said Friedrich.
At Bazaarvoice, Osborne said, they required sales candidates to pitch the company to them. They weren’t given any materials, but they were free to call the sales staff to ask questions.
“We got some of the most amazing insights on how to pitch us,” Osborne said. “We know right away from the pitch if they can do the job. We had people who we thought ‘This guy is a shoe-in’ but then they wouldn’t do well on that test. If they could crush the test, 90 percent of the time they’d do well.”
McCormick said he asks candidates “How are you going to get into this company? Sell me on how you’re going to get into this company. It’s amazing how many people dance around that….”
The Money and The Fame
Top sales people, the panelists agreed, often aren’t the same as top sales managers. Top sales people want the money and they want the recognition. Top sales people want the numbers to come from their success. Friedrich said it was important to keep the compensation predictable, or it can hurt the culture of the organization. But most executives and account managers know their best sales people are going to make more money than they do, and that’s alright.
“Sales people prefer recognition over compensation,” Osborne said. “They won’t work for free but they want to crush everyone else. They want to embarrass people.”
McCormick said if someone’s more interested in the base than the commission, it’s “game over.” “I’m a money motivated bastard,” McCormick said. “A true salesperson wants to dominate everybody.”
For that reason, companies often don’t promote their top sales people to sales manager. Many people don’t transition well from the role of a rockstar sales person with the spotlight on them and the money they can make as an individual to a team leader.
By the same token, a company has to have a clear agreement with respect to the compensation of the sales people—the hunters—and the account managers—the farmers. Farmers don’t get paid the same as hunters because the hunters brought them in the door. Osborne pointed out that the ones handling the money shouldn’t be the same as the ones “trying to keep you happy all the time.” But McCormick believes it’s important for the client relationship to let the hunters continue to have communication with the client, for the client’s sense of continuity.
By the same token, if someone wants to move to the sales side and can make a case, most of them said they’d give that employee a shot. Sometimes it works out great. But more often than not, other employees run from sales.
After all, as Osborne said, with sales there’s a huge risk. You miss two quarters…you’re out.
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