Is Your Sales Culture Hurting the Bottom Line? 6 Factors to Check

Are you worried about sales employees missing their quotas? The root cause might lie in your company’s sales culture.

Why Should We Care About Culture?

The culture of your company shapes how people think and act in their work each day. Company culture shapes attitudes to working hours, performance management, hiring, promotion, and much more. Your sales culture is shaped by who you hire, how you develop talent, trust between team members, and other factors.

Understanding Company Culture Vs. Sales Culture

To thrive as a sales leader, it is crucial to connect to the overall corporate culture and sales culture. For example, the company might have a culture that emphasizes innovation as a core value. Working aligned with that value may manifest as consistently investing in new technology and tolerating the learning curve. A sales leader in an innovation-centric organization may face a delicate challenge: what if sales reps procrastinate on their prospecting work because they are excited about learning new sales technologies every month?

In this scenario, the sales leader faces a problematic cultural dilemma. On the one hand, they need to support the company’s overall emphasis on innovation. On the other hand, a sales team that consistently fails to deliver on revenue goals will not be kept around for long. Solving the imbalance in this scenario could be simple as coaching staff to manage their time better. For example, the sales leader might encourage staff to pursue learning goals for 2-4 hours per week and then focus most of their working time on their core work responsibilities: prospecting, talking to customers, and managing deals.

Six Factors To Optimize Your Sales Culture

For a sales leader to succeed in your organization, they need to align with your company’s overall culture and the unique demands of sales. For example, a VP of sales needs to know how to work with their peers in marketing, finance, and customer service to advance its goals. These collaborative abilities are helpful. Yet, they are not enough to drive sales success. Your organization also needs to create the right mix of incentives, expectations, and support for salespeople to thrive.

To evaluate if your sales culture is healthy, consider the following factors.

1. Sales Values

The starting point for a good sales culture lies in the values of the team. The right sales leader can set the tone here. Your values might include valuing ambition, honesty, and rewarding success. The values of the sales team will probably be distinct from corporate support functions like finance. Taking the time to describe 3-5 values for the sales team and then living up to them lays a good foundation for the sales team to succeed.

2. Sales Goals and Quotas

Developing sales goals takes careful thought. For example, an experienced top performer in the company might have a higher quota than a new hire. Such differences reflect the skills of the team.

According to the Sales Insight Lab, only 24% of salespeople exceed their quota each year. If you see the same pattern in your organization, the cause could be unrealistic quota expectations or weaknesses elsewhere in your sales culture. Research reported in the Harvard Business Review reports that the habit of “ratcheting” quotas (i.e., raising a person’s quota for next year if they hit this year’s quota) may hurt long-term results. Your sales culture will inform how quotas are designed and managed.

3. Sales Compensation

Sales is a highly competitive profession. If you are losing a significant number of your sales employees, poor compensation may contribute. Harvard Business Review research suggests that simplicity should be a guiding principle in your compensation plan. If sales representatives cannot easily understand how much they will make, their motivation may suffer. Keep this factor in mind if you have developed a complex compensation plan. Ideally, salespeople should be able to figure out quickly how their compensation relates to their performance.

4. Sales Autonomy

Research published in the International Research Journal of Business Studies on 190 bank salespeople found job autonomy was significant in job satisfaction. Based on this insight, a healthy sales culture should give salespeople plenty of flexibility on how and when they reach their goals. Mandating that all salespeople work the same schedule and in the same ways may not be effective.

5. Sales Management Support

Sales managers and leaders have an essential role in guiding their teams to success. For example, a sales manager who rarely provides feedback on prospecting, proposals, and other sales skills effectively prevents the sales team from reaching their potential. Management support goes beyond coaching. It also includes going to bat for the sales team when they need new technologies or assistants to achieve their goals.

6. Sales Reporting And Accountability

Numbers and metrics are critical components of any highly effective sales culture. For example, a sales leader might track leading indicators like the number of sales meetings booked per week. Focusing on leading indicators like prospecting activity and sales meetings is ideal. Choosing the right mix of metrics and reports to motivate your sales team takes judgment. Too many reports risk becoming nothing but noise, while infrequent reports provide minimal value.

The Key To Improving Your Sales Culture

“Creating a values-based culture is crucial. It allows for a fundamental starting point for performance related conversations and provides an opportunity to address goals and areas for improvement. It connects culture to performance and must be reinforced constantly.”
– Chris Donnelly, VP Sales at Peak Sales Recruiting.

Improving the sales culture of your company is no easy task. It takes time to change ingrained habits and ways of working. Indeed, there is no “quick fix” to better sales performance. However, there is one way to accelerate progress: finding the right sales leader. By all means, start with talking to your current sales leader about the sales culture and ways it can be improved.

If your current sales leadership needs support, hiring a new sales leader with a mandate to transform sales culture is an excellent path forward.

The best way to find a high-performing Sales Executive to drive change in your organization lies with Peak Sales Executive Search. We recruit high-performing sales leaders with outstanding capabilities and ambition to drive higher performance.

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