What is Fractional Sales Management?

Most organizations have heard of fractional services. Today, B2BCFO alone has over 600 outsourced Chief Financial Officers serving a diverse array of clients. These same mid-sized and small businesses have a similar struggle in the sales management arena.

Whether you have 10 sales professionals or no members of your sales team, it can be a financial impossibility to employ a full-time sales manager, especially one with the requisite skills to move the organization forward. Organizations continue to spend money and resources on hiring sales personnel and also on training. But the studies are endless proving that ongoing coaching and development is what drives results.

A fractional sales manager divides his or her time between 5-10 local businesses, spending time with each organization. By dividing the cost of a superstar sales manager, businesses get the intellectual property, best practices, and management skill they need, but at a cost they can afford.

WHO USES FRACTIONAL SALES MANAGERS?

Fractional sales management is a good fit for B2B sales teams of less than ten. B2C companies can also benefit but the higher the sales transaction and the longer the sales cycle the better. Here are just a few examples of companies that have benefited from fractional sales management:

• Manufacturing

• Distributors

• Engineering/Architectural Firms

• Software Developers

• Other IT companies

• Staffing companies

• Construction (roofing, home builders, paving, remodelers, etc.)

• Trucking

Regardless of industry, any company that has “leakage” in the sales department can benefit. Here’s a few of the areas we see profit leakage:

• Closable deals lost due to poor sales process or salesperson skills

• Salesperson turnover due to under-management or under-coaching

• Poor hiring process and systems that lead to under-performing reps

• Organizational stress caused by “not knowing where the next deal will come from”

• Under-use of technological sales tools. Companies have saved hundreds of thousands of dollars on this item alone and increased sales simultaneously. We realize this sounds unbelievable, but it’s true.

• Failure to create a system that religiously seeds best practices amongst the entire sales force

COMMON CHALLENGES

Business that manage a small sales force tend to fall into one of the following “traps” that create challenges and barriers to success:

1. Nobody manages sales. The owner feels that the staff is experienced enough and have the tools they need so nobody manages the sales team. In this case, the inmates are running the asylum. It is true that tenured sales professionals need less coaching and development than inexperienced professionals but is there room for improvement? A sales management superstar brings best practices, coaching skills, and the ability to close the marginal deals that are being lost.

2. The owner ½ manages sales. Business owners already have numerous jobs. Add sales management to mix and more than likely, it is not truly getting done. It also is most likely not hyper focused on generating revenue and improving the skill sets of the sales team. Placing a sales management pro into this void can remonetize neglected aspects of the sales function.

3. The best salesperson is asked to keep selling and also fill the sales manager role. This is the most destructive of the three traps. This scenario typically plays out like this – the sales manger’s sales production decreases due to the increased time/emotional demands and the sales person does an average or below job as sales manager. Not to mention that the skill sets of selling and managing someone else to sell is absolutely NOT the same thing.

PROS AND CONS OF FRACTIONAL SALES MANAGEMENT

Despite the many benefits of fractional sales managers, it’s not for every company. Yes, a part-time sales manager can provide most of the benefits of a rock star sales manager for a fraction the cost, but there are some important challenges of the model. The biggest adjustment for clients is losing the “babysitting effect.” Whether it is a salesperson assisting with management or the owner managing the team, many companies feel more comfortable having someone in the building all the time. A fractional sales manager is only in the office a half a day a week. By definition, the fractional sales manager cannot do all the tasks which a full-time person can. However, the fractional sales manager has the talent to accomplish objectives that are beyond the skill set of the current team. That’s the trade off. The company that needs skill applied to the sales function, not just time, will benefit the most. Another issue that can creep into a part-time sales management engagement is speed of implementation. The sales manager creates a plan that will revolutionize sales results and the owner wants the entire plan done NOW. It’s understandable, however, impossible to accomplish in a few hours a week. All the great plans will get implemented, but in due time. Savvy fractional sales managers have learned to remind the business owner that they have gone years without these initiatives, so a few months more isn’t that long to wait for massive change.

WHAT TO EXPECT FROM A FRACTIONAL SALES MANAGER

Below are some of the direct and indirect benefits you could expect from an interim sales manager. Direct benefits

• Increased lead flow

• Implement dozens of best practices from high-performing sales teams

• Create and upgrade the Proven and Repeatable Sales Process (PRSP)

• Implement technological tools, tricks, and process to lower sales costs and increase sales

• Improve salesperson retention and performance with individualized coaching sessions

• Create a predictable sales pipeline so future sales levels can be predictable and accurate

Indirect benefits

• Create and manage the company-wide sales process so salespeople cannot “twist management’s arm” by threatening to quit and walk out with the sales process

• Reduce time demands upon the CEO so their valuable time can be redeployed to a higher and better use

• Reduce turnover

• Create a performance sales culture

• Demonstrate to the entire company that the sales function is important (via the investment in sales management)

• If desired, technological leverage can create an opportunity to reduce dependence upon a weak salesperson to the level the person can be redeployed or released

IS THIS A TREND?

The short answer is yes. Thirty years ago, no one knew what a part-time CFO was. Ten years from now, outsourced sales management will be commonplace amongst small sales forces. The reason is competitive advantage. An organizations product or service is what it is. Where a small company can gain a competitive advantage over the competition is by getting bigger, stronger, faster on the sales team. A fractional sales manager can bring the sales advantage to the organization without the added costs and the heavy burden these days of adding headcount.