Sales organizations can be complicated. There are many moving parts and many things that need to be managed effectively. Your sales success is affected by many factors.
The idea behind multiple salespeople is that all business processes are shared within the sales organization and each person is responsible for them. What if there is only one salesperson? Simply put, you will need to identify which salesperson is responsible for each process and then create an organizational structure that includes the appropriate roles. These are the people who should be overseeing the process and should report back to the sales manager.
A model that balances the needs of sales professionals with those of the company is essential for effective sales organizations. There are many ways to achieve this balance. Many sales people are in control of their own needs. This can cause jealousy and low morale among the sales team. Other organizations have the salesperson responsible for the needs of all sales people. This can lead to jealousy and low morale.
This blueprint will show you how to build a sales team that delivers results. We no longer see salespeople as individuals. Instead, we can view them as part of a team. This is due to the fact that SaaS has changed. This post will discuss the best sales teams and how to choose one that is right for you.
A strong sales force structure is crucial for any corporate organization. It ensures that everyone is clear about their responsibilities. It aids both sales reps and businesses in reaching their goals.
A well-organized sales department has many benefits, including:
The number of employees involved in conflict has declined.
- Increases employee-to–employee communication and client-to–client communication
- Enhances staff productivity
- Better decision-making
Now that we have covered the benefits and importance of a strong sales force structure, let’s define what a sales organisation structure is.
A sales department structure is the design of a sales team. This structure outlines the goals and duties of all employees within a company. The structure of a sales organization is the division of sales forces into specialized groups with their own set of responsibilities.
There are many variables that can influence the organization of a sales group, such as:
- Serviced areas
- The size of your sales team
- The variety of services and products available
- Size of customers
There are seven types of sales organization structures.
The Production Line
A person’s job title is used to structure the sales team. Leads are transferred between specialists teams, just like in an assembly line. This sales structure’s goal is to get prospects through the sales process as quickly as possible.
- It is encouraged to specialize.
- Sales reps become specialists in their respective areas.
- There is the possibility of poor customer service due to too many handoffs.
- Additional expenses are associated with specialization.
- The Island is number 2.
From the initial lead generation stage to the client’s acceptance in the Island model, one representative handles each prospect. This sales organization structure is often used by smaller sales teams who want to improve their productivity. Sales departments who benefit from personal client contact may use this sales structure.
- It encourages competition.
- Maximizing individual productivity is key.
- Management of multiple accounts can be taxing.
- Individual success is more important than collaborative effort.
The Pod (#3)
The Pod is a combination of both the island and assembly models. A pod is composed of specialists who deal with prospects at various stages of the sales process. This sales organization model is most commonly used by large businesses because it divides the sales team into smaller divisions.
- Facilitates seamless lead handoff
- Sales teams can make skill-based changes
- Sometimes, poor performance is hidden by successful colleagues.
- Motivation for oneself is more difficult.
There are four additional organizational models that you should consider, apart from the Assembly, Island and Pod organizational models:
- A range of products and services
- Customer/account size
- Section Vertical/industry
Geography and Territory Structure
This structure allows members of the sales staff to become familiar with their local environment. Sales staff might even establish relationships with local businesses and conduct research on competition.
It makes it easier to assess sales reps by focusing on the potential and performance of a specific area.
Structure of Product and Service Lines
Based on the products and services they offer, sales teams are broken down into groups.
It allows sales reps to network with people who are similar in product/service or even geographical interests.
Sales teams become experts in the products they sell, which results in increased revenue and mastery of the sales process.
Customer and Account Structure
This arrangement is common for sales teams and works well with account-based Marketing (ABM).
A strong ABM team structure can help sales teams organize by account or customer. This will allow them to better serve the client’s needs.
Vertical Structure & Industry
- Another way to organize a sales group is by industry, or vertical.
- Specialized sales teams will have greater knowledge and expertise in certain markets, which can lead to higher close rates.
- We recommend segmenting your sales team into verticals if your company sells to many sectors.
- The Winning By Design Blueprint Series contains blueprints that will help you succeed.
- The Winning By Design Blueprint Series provides sound guidance for every aspect a SaaS sales team.
- In the past, B2B salespeople were referred to informally as individual contributors.
To meet quotas, reps were trained and recruited. This was during a time when enterprise salespeople left the office on Monday to return to work on Friday with signed purchase order, submitted costs, and updates.
Although it may look like something from a movie, most structures of sales organizations have remained the same since then.
Traditional Sales Team Structure vs. Modern Sales Team Structure
TSOs (Traditional Sales Organizations) – TSOs were traditional sales organizations whose staffing growth was determined by the revenue per individual contributor (IC). This concept used a waterfall-like approach, where each donor brought in $2 million annually.
A VP of Sales would allocate $10 million in quota at $2,000,000 per IC to reach $8 million. Five ICs would be required to accomplish this. Each IC would be assigned a territory. These areas were created with ZIP codes that had about the same potential.
To match an increase in quota, salespeople were simply hired more. For example, $2,000,000 per person and a 20% increase on the original target.
Image: The root cause of today’s problems is the adoption of an outdated model that allows for fewer transactions at higher prices.
Modern Sales Organizations – Due to lower deal values (ACV), it is necessary to renew ongoing to make the same profit. This could take up to 24 months.
Due to the lower price, it is more difficult to achieve comparable growth. This business operates at a high velocity, which can make things more complicated. Many customers will commit within 90 days. This high-velocity technique can be called a “production line.”
A POINT INSERT:
SDRs need to generate business for AEs. They must get customers, commitment, as well as help them onboard until they are able to use the service to increase their income yearly.
Recurrent needs: It is clear that businesses can’t just renew their account every year. Instead, through the use of CSMs or AMs, they need to verify that customers are using it and identify new opportunities within the account.