One of the biggest problems a sales org can have is a lack of transparency.
That means when something bad happens, you don't know exactly why it happened.
And equally - if not more - dangerous is the opposite. When something good happens, you don't know exactly why it happened.
So what causes this lack of transparency?
Usually, it simply comes down to the fact that the sales org has been pieced together over time without really clearly delineating who's responsible for what, when, and why.
This is especially relevant for startups, since everyone tends to wear multiple hats and operate under blurred lines. But it also applies to large companies that are growing their sales team without really considering the organizational structure needed to keep things operating smoothly.
If you truly want to scale your revenue, you need to build a sales team that is designed to be scalable and then developed intentionally.
An effective sales team structure is crucial for driving sales performance and revenue growth. It provides clarity, accountability, and a framework for success. With the right sales team structure in place, you can ensure that everyone on your team knows their roles and responsibilities and that there is a clear hierarchy and division of labor.
But how do you create an effective sales team structure? In this article, we'll explore the key elements of a successful sales team structure, including the role of sales managers, determining the ideal team size, creating a sales team hierarchy, and balancing individual and team performance metrics. We will also discuss the importance of clear roles and responsibilities, building cross-functional teams, and designing territories and sales quotas.
By implementing these strategies, you can unlock the potential of your sales team and drive revenue growth. So let's dive in and discover the key to an effective sales team structure.
Defining the Sales Team Structure
A sales team structure is a framework that organizes and aligns sales resources to maximize efficiency and productivity. A sales team, like any professional crew, needs a clear organizational structure, after all! It helps to define the roles and responsibilities of each team member and establish clear lines of communication and accountability.
The Role of Sales Managers in Team Structure
Sales managers play a crucial role in the sales team structure. They are responsible for setting goals and targets, providing guidance and support to team members, and ensuring that the team is working towards achieving its objectives. They also act as a bridge between the sales team and other departments within the wider company.
Here at Vouris, we're big believers in the idea of hiring a sales manager before looking to add executives to a small team. A good sales manager with a handful of good reps will take you a long way. We'll get into more detail exactly when and why to hire other roles, but this is an important point to consider first!
Different Roles on a Sales Team
Understanding the various roles within a sales team is crucial for effective sales management. Here are three key roles and their responsibilities:
Sales Development Representatives (SDRs): An SDR focuses on outreach, prospecting, and qualifying leads to create sales opportunities for the team.
Account Executive (AE): An AE is responsible for closing sales deals, managing client relationships, and ensuring customer satisfaction post-sale.
Sales Manager: A Sales Manager oversees the sales team, setting goals, developing sales strategies, and monitoring performance to drive revenue growth.
VP of Sales (Vice President of Sales): The VP of Sales leads the sales department, strategizing long-term sales plans, managing key accounts, and collaborating with other departments to achieve the company's sales objectives.
Customer Success Manager: Responsible for ensuring clients are satisfied with the products or services, helping with onboarding, and providing ongoing support to maximize customer retention and growth.
Sales Operations Manager: Focuses on the efficiency and effectiveness of the sales team, overseeing sales processes, tools, analytics, and operational strategy.
Sales Engineer: Often involved in more complex sales, especially in technical fields, providing expertise and support in explaining and customizing products or services to potential clients.
Market Development Representative (MDR): Similar to BDRs, MDRs focus on creating demand and interest in new markets or with new types of clients.
Channel Sales Manager: Manages relationships with channel partners, such as resellers or distributors, and develops strategies to increase sales through these channels.
Sales Enablement Manager: Responsible for equipping the sales team with tools, resources, and training to improve their efficiency and effectiveness.
Lead Generation Specialist: Focuses on generating leads through various tactics like email campaigns, social media, or events, which are then passed on to the sales team for follow-up.
Sales Analyst: Analyzes sales data and trends to provide insights and recommendations for improving sales performance and strategy.
Key Account Manager: Manages relationships with key clients, ensuring their needs are met and identifying opportunities for upselling or cross-selling.
CRM Administrator: Manages and customizes the Customer Relationship Management (CRM) system to ensure it meets the sales team's needs and enhances their productivity.
A sales team can take many, many different shapes and sizes, and include any or all of the above roles. For most smaller teams, though, you'll often see a more limited collection that might look like this:
- Sales Manager
As the sales organization's structure expands, you can add many different types of people to the team.
Understanding the different roles on a sales team is essential for building a successful and efficient sales organization. By assigning the right responsibilities to the right individuals, you can maximize sales performance and achieve your revenue targets.
Determining the Ideal Sales Team Size
Determining the ideal size of a sales team depends on various factors such as the target market, sales goals, and available resources. It's important to strike a balance between having enough team members to handle the workload and not having too many members so that it becomes difficult to manage and coordinate effectively.
If you've seen our Sales Compensation Model, you'll notice that we work backward from a revenue target to figure out a team's makeup and comp. Our model also includes a look at the profitability of the team, which is a key element that many "calculators" overlook.
The Importance of Clear Roles and Responsibilities
Defining and communicating clear roles and responsibilities within the sales organization structure is essential for avoiding confusion and ensuring that everyone knows what is expected of them. This clarity helps to streamline workflows, improve collaboration, and increase overall productivity.
Building Cross-Functional Sales Teams
Building cross-functional sales teams can bring numerous benefits to an organization. By bringing together individuals with diverse skills and expertise, cross-functional teams can enhance collaboration, problem-solving, and decision-making. This can lead to improved sales performance and customer satisfaction.
When you have a growing, developing sales organization structure, having this flexibility can help you ride the natural ups and downs of a market. You might find that a single full-cycle AE can handle more than you realize. Or if one of your reps has some marketing chops, they may be a great asset in bringing your sales and marketing into better alignment.
Different Types of Sales Team Structures
When it comes to structuring your sales team, there are various ways to organize your people. The right sales team structure can greatly impact your business's success, and there are a bunch of different ways you can design your team. Here are three different types of sales team structures commonly used:
- Hierarchical Structure: This type of sales team structure has a clear chain of command, with managers overseeing teams of sales representatives. It provides a sense of direction and accountability, ensuring efficient communication and coordination.
- Territory Structure: In this structure, sales territories are divided geographically, with each salesperson responsible for a specific region. This allows for a focused approach, as sales reps can develop deep knowledge and relationships within their assigned territories.
- Product-Based Structure: With this structure, sales teams are organized around specific products or product lines. This enables sales reps to become experts in their respective areas, providing customers with specialized knowledge and tailored solutions.
Understanding the different types of sales team structures can help you determine which one aligns best with your specific needs. Whether you're looking to improve efficiency, adapt to changing circumstances, or enhance customer satisfaction, choosing the right sales team structure is crucial.
Designing Territories and Sales Quotas
Designing territories and setting sales quotas is an important aspect of the sales team structure. Territories help to divide the market and assign specific areas to each sales team member, ensuring that all potential customers are covered. Sales quotas, on the other hand, set targets for individual team members to achieve, providing motivation and a sense of accountability.
When it comes to sales quota, you have to balance challenging your team while also being realistic about the likelihood of achievement. The right targets will both push and reward your team - a real win-win for everyone.
Balancing Individual and Team Performance Metrics
Just like quota, balancing individual and team performance metrics is crucial for maintaining a healthy and competitive sales environment. While individual performance metrics focus on the achievements of individual team members, team performance metrics measure the overall success of the sales team. Striking a balance between the two can help to motivate and incentivize team members while also fostering a sense of teamwork and collaboration.
Next Steps For Your Sales Team?
Implementing an effective sales team structure is crucial for unlocking success and improving sales performance. Defining roles and responsibilities, creating a hierarchy, and building cross-functional teams are all key elements to consider.