When looking to right size your sales force, make sure you ask yourself the following questions…
1. Do I have a business rationale for current sizing?
There are basically three stages to a business life-cycle: growth, maturity & decline. The size of your sales force will vary depending where your business is on this continuum. For example, startups in high growth industries will grow their sales force to capture market share. On the opposite end of the spectrum, industries in decline are looking for ways to reduce headcount or shift from higher paid outside sales resources to a more economical inside sales model.
2. Do I connect territory penetration and potential to sizing needs?
The goal of sales force sizing is to match selling capacity to market dynamics. Ignoring territory penetration and potential when adding or cutting headcount is a big mistake. See my previous blog post for more on this subject.
3. Are the number of accounts in sales territories based on selling capacity?
Each account demands a certain number of account management and account development hours. A typical sales rep has 2000 hours (50 wks x 40 hrs/wk) of potential selling time in a year. Of those, some is spent on non-selling activities (administrative, etc.) verses actual selling activities. Reps should be deployed within a territory taking into consideration actual available selling time and hours required within each account.
4. Is sizing done by role or in aggregate?
Headcount calculations should not be limited to sales reps. Often, companies need to add sales managers, inside sales reps and administrative support personnel. Sales Force Sizing decisions should be done by role.
5. Do I use any sizing tools or models currently?
Very few companies employ a scientific method or sizing tool to determine sales force size. The majority employ a few popular but incomplete techniques that focus primarily on cost and affordability. The best Resource Planning models incorporate market dynamics in the analysis.
To learn more on how to determine the real potential of your accounts & territories so that you can connect sales force sizing needs, watch the SlideShare webinar recording embedded below.
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