Why a Lack of Sales Skills is Holding New Zealand Businesses Back

Hitting Sales Targets

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As globalisation and other key pressures continue to affect the growth of New Zealand businesses, it is imperative that CEOs understand the potential uncertainties facing their organisation and industry.

It’s also important to have the right strategy in place to counteract these roadblocks to success. This often begins with recognising where there may be corporate inefficiencies, particularly in sales, as this is where the majority of incoming revenue is generated.

In a 2016 survey of more than 200 CEOs and senior business leaders, whose businesses had an annual turnover between 20 and 100 million dollars, it was confirmed that there are three critical areas that are holding organisations back in Australasia.

1. Lack of internal sales skills

Figures from a global evaluation* of more than one million salespeople have revealed that sales people in Australasia have, on average, only 25 per cent of the skills necessary to close a sale. The same evaluation also showed that they have only 53 per cent of the skills to qualify prospects effectively, and only six per cent were good at presenting quotes and proposals at appropriate times.

The result? A lot of wasted time with unqualified prospects and low conversion rates. Millions of dollars of lost revenue are being left at the table!

It is understandable that these numbers can be rather confronting to a CEO of any organisation, but knowing them is the first step to realising that their internal sales training and recruitment process needs to be adjusted.

2. Ineffective leadership

When a position of sales manager becomes available in an organisation, it would be safe to say that most of the time a salesperson who has a good performance record, and has put in their time, will be promoted into the role.

Unfortunately this is an extremely outdated and unreliable resolution to the issue, and it is where SalesStar’s CEO Grant Holland says many organisations go wrong.

“Part of the problem is promoting star performers to leadership positions. A common practice in Australasia is for companies to appoint the best sales person to a management position, with no experience, no training and probably no leadership ability.

“The result is that they’ve exchanged a star performer for an average manager.”

This is particularly important as it is the managers who play a vital role in cultivating and developing staff to become great salespeople. So when the same evaluation showed that sales leaders, on average, have only 44 per cent of the skills necessary to coach effectively—and they spend either little or no time doing it—there will be a continual struggle to establish successful salespeople in the team.

3. Counterproductive sales processes

Results from the same global evaluation mentioned above also discovered that only three per cent of salespeople have an effective sales process methodology. This makes it difficult to track progress, or hold people accountable to the right actions, which of course has a detrimental effect on the growth of an organisation.

And with only six per cent of those in sales actually presenting quotes and proposals at the appropriate time, there is no question that many outcomes are poor, and potentially damaging to the perception of a business.      

What is evident from these kinds of statistics, is that having a the right skills and correct sales process is the foundation to the success of all sales teams, no matter the organisation or industry.

While the three elements discussed have their own separate issues to be resolved, what is fundamentality obvious is that CEOs need to recognise these symptoms as part of a wider problem when it comes to inefficiencies in sales teams, and how it affects the growth of New Zealand businesses.   

*Statistics supplied by the Objective Management Group.

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