The 4 C's of Sales Strategy and Restructuring

There are four key components to effective sales strategy:

• Who you are selling to
• What you are selling
• How you are selling
• Why you are different

These strategies support better returns for the sales organization (Revenues – Cost of Sales). Asking fundamental questions like these begin to point to significant gaps and opportunities around sales structure and alignment.

While decisions related to sales strategy, model, and structure are highly unique to an organization, we find that investigating four core areas – what we call the 4 C's of sales strategy – can help guide those decisions:

• Customer – How do you segment customers based on size, potential, needs, capacity, location, etc.? Which are your highest priority segments?
• Coverage – Based on what you learned in customer analyses, how should you define your coverage model to best align with your highest value segments?
• Capacity – What is the workload required to sell and service customers? How do we size/resource our team (and selling roles within it) accordingly?
• Capability – What competencies do our people need in order to engage in the right conversations with different levels of customers?

In numerous interviews we conducted for our book 7 Steps to Sales Force Transformation, we found that determining whom you should and should not sell to is an essential first step. That decision alone will inform everything else you do, like defining your sales transformation roadmap.

When defining a sales transformation roadmap, leading sales organization focus on:

• The structure of the sales team(s)
• The capabilities, tools, people, and processes that are required for success
• There is NO “one-size-fits-all” strategy
  

For example, a technology hardware provider wanted to reexamine how their product went to market (direct vs. channel), as well as whether to focus on large, global accounts. In its initial state, the company focused mainly on territories. But those held little market opportunity. This consumed effort away from important drivers for the business, meaning less time to focus on the top 5% of account base. The company required an account-based structure, with a strategy to capture higher wallet share and sell differentiated solutions, including intellectual property, services, and hardware.

Once sales structure and go-to-market strategy were reformulated, our client began to re-evaluate its team capability and their ability to effectively execute the new strategy.

Their new roadmap included:

• Work streams covering up-skilling and hiring new talent
• Deploying new tools and technologies
• Defining business processes that align with future state strategy
  

Another client, a large CPG firm, reshaped their business from a portfolio of siloed companies into an integrated company. Their transition better met the needs of customers and delivered strong results for shareholders.

This company had six separate sales and marketing teams calling on the same retail customers. They sought to streamline these disparate teams into an integrated selling organization offering the “full bag” of solutions.

Based on the 4 C’s, we revamped the following:

• Customer – ranked more than 7,000 customers based on current revenues and cross-sell potential
• Coverage – created revised sales territories that reduced average overnight stays from 89 to 41 for a geographically focused field-based team
• Capacity – determined the amount of time required to sell and service customers, including financial cutoff for covering a customer with a field-based salesperson
• Capability – facilitated a sales talent assessment with sales leaders that aligned to the revised territories. Then partnered with brand and marketing to equip the field to sell the full portfolio of solutions using a new unified sales process
  

As a result, the company gained $1.9m (11% of the COS) in savings by consolidating the sales team and earned a 22% increase in sales due to more customers buying multiple products/categories. They also increased customer satisfaction by setting a single point of contact.

How well have you aligned the 4C’s for your sales organization? Does your sales team need to be re-structured to better align with market opportunities? For a more in-depth approach to sales restructuring and resourcing decisions, please feel free to contact us to learn more.