Sales Leaders Must Focus on Long Term Productivity Oriented Investment

When facing economic downturn, often seen sales leaders cut costs to mange short term situation instead to focus on long term productivity oriented investment. However, these types of decisions can inhibit sales strategies coming out of that tough economic environment and make bouncing back that much harder. Sales leaders instead must focus on making small but powerful changes to start positioning their teams to take advantage of the opportunities that economic uncertainty and a downturn can create

Gartner recommends the following cost management activities to address three of the most common cost-cutting tactics: 

1. Get Ahead of Travel and Entertainment Cuts

It’s common for sales organizations to freeze travel and entertainment (T&E) during tough economic environments, however, doing so can leave customers underserved. Instead, sales leaders should leverage their internal financial planning and analysis partners to review current T&E spend and identify trends that can be proactively remedied. Communicating new T&E behaviors to sellers ahead of a potential economic downturn can help mitigate overly broad cuts later. 

2. Analyze Sales Productivity

In an economic downturn, sales leaders often face the unenviable task of reducing their sales force size based on past sales or future sales projections. To mitigate this, sales leaders should engage sales operations teams and analyze sales productivity ahead of time. By leveraging market, customer and seller data, sales leaders can optimize seller time between farming and hunting activities, as well as new and existing accounts. 

3. Audit Subject Matter Expert Activity

Gartner research shows that subject matter experts (SMEs) provide more value, on average, than sellers when closing deals. Instead of reducing SME head count to cut costs, sales leaders can optimize SME productivity and spend by working with SMEs to audit their time, identify low-value, high-frequency sales activities. Sales leaders can then codify information related to those activities in enablement tools for sellers.

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“Economic cycles of expansion and contraction are an unpredictable reality. By pursuing opportunities for cost optimization before the urgency and uncertainty of a downturn hit, sales leaders better position their sales teams to weather the storm and help their customers do so too,” said Matt Dudek, vice president and team manager at Gartner.