CHANGE OPTIMIZATION
Getting HR and Sales to Work Together in
a Collaborative Way
April 2013
Presenter
Joseph DiMisa, CSCP
Senior Vice President, Sales Effectiveness Practice
Leader—Sibson Consulting, a Division of Segal
Joseph DiMisa runs the sales effectiveness practice for Sibson
Consulting, where his areas of expertise include working with
companies to develop and implement direct and indirect
compensation plans, sales strategies, and sales effectiveness
programs. He has more than 20 years of experience working
with telecommunications service providers, computer and
communications equipment providers, software, and
manufacturing companies.
 Author of Best Selling business book
The Fisherman’s Guide to Selling
 Author of Sales Compensation Made Simple
 Certified WorldatWork C5—Elements of Sales Compensation
and C7 Strategic Sales Market Pricing
Introductions: About Sibson Consulting

Part of The Segal Group

One of the 10 largest benefits
consulting firms in the US

Five practices dedicated to improving
human capital effectiveness:

Sales Effectiveness

Performance and Rewards

Organization and Talent

Retirement

Health
Some of Sibson’s Experience
Extensive Experience. Sibson Consulting has 50 years of experience
successfully serving clients and has worked with most of the Fortune 500 and
many small and mid-sized companies. We have experience with a range of
company types and industries.














3Com Corporation
Adelphia
Adobe Systems Inc.
Apple
Ariba Inc.
AT&T, Inc.
Autodesk
Avaya Inc.
Bank of America
Broadcom Corporation
CA Technologies
Cable One
Canon U.S.A., Inc.
Centive (acquired by Xactly
Corporation)



Cigna
Cisco Systems, Inc.
Citigroup Inc.



Comcast
Cox Enterprises, Inc.
Danka Office Imaging Co. (acquired by
Konica Minolta Business Solutions U.S.A., Inc.)














Dell Inc.
Hyperion Solutions Corp. (acquired
by Oracle)
IBM
Insight
Iron Mountain Incorporated
iSoft Corporation
Knology
Knowlagent, Inc.
Memorial Hermann HNP
Mentor Graphics Corp
Microsoft
Motorola Mobility Inc.
NFL
Nortel Networks




Oracle Corp.
PricewaterhouseCoopers LLP
Questlink
Qwest Communications (acquired by
CenturyLink)







Rogers Communications
Scientific Atlanta
Siemens USA
Sprint Nextel Corp.
Sun Microsystems (acquired by Oracle)
Symantec Corporation
Symbol Technologies (acquired by
Motorola)





Time Warner Cable
Unisys
Verizon Communications Inc.
Xerox Corporation
XO Communications, LLC
Why Change? – Organizations Need to
be Better/Smarter/Bolder
“Innovate or be left behind”
“Embrace bold thinking”
“Redefine what is meant by selling
before someone else does it for you”
Human Resources and
Sales Working Together – Sales Can’t Do It Alone
They know they cannot do it alone…
Increasing growth goals
- 15 to 30% year over year
Turnover high in sales organizations
- 20 to 25% considered good turnover
New product launches
- 3 to 4 a year
Human Resources and
Sales Working Together
How HR Plays a Role
with Sales?
Human Resources executives
and their staff confront
change continually…
This experience makes them sensitive to the many tangential
issues that attach themselves to any effort and gives them an
objective view of what works and what does not when making
change happen!
In this respect, HR executives can be exactly what their sales
counterparts are seeking – Namely, confidantes and partners in
the organization change process
Human Resources and
Sales Working Together
But what happens?…
Good intentions but bad
execution…
Instead: Two Separate Organizations…
In extreme examples,
the success rate drops
by another 40%...

HR comes with good
intentions


Data, Energy, Process
Sales has specific goals

Get It Done
HR falls short on business acumen and aren’t conversant in the language of sales.
Sales does not understand how their requests affect other areas of rewards,
organizational structures, equality, or consistency.
LETS TAKE A LOOK…
Let’s Look at What Happens – Our Experience
Numerous (30-40 in last 3 years) organizations initiate large scale
change to become more efficient, profitable and well positioned,
without coordination…
…less than 30% of these changes are
successful in achieving the desired results

Whether the change is a technology
implementation, an internal reorganization, a
job role change or sales compensation change
or an acquisition integration, organizations
spend millions of dollars and significant
time researching, evaluating, selecting and
implementing the right approach…
But little effort is spent getting
HR and Sales to work together!
Most Frequent Executive Quotes
Does this sound familiar to you? Who Said It?
“We need to make our leaders understand that HR deals with real
business issues.”
“The need to have qualified people has greatly increased.”
“We are hungry for information on how to have better metrics.”
“Everything HR does must directly impact/support revenue,
productivity and building the company’s desired culture.”
“HR should get out of the way of what the business needs to do.”
“If HR wants to be a business partner they need to be measured on
business results and put their pay at risk.”
“HR needs to understand the business but focus on the people
stuff.”
“Sometimes HR jams things down our throat and then makes us pay
for it.”
“HR needs to be more like Sales, listen to what we need, then hook
what they have to what we need.”
The Sales Organization’s Role
Let’s Clarify for a Minute….
Sales typically has the pulse
of the customer base, the
products and operations
Role of Sales…
Sales And Marketing Goals

Achieve and surpass their growth and profitability
objectives

Drive the productivity of the sales force

Improve the cost effectiveness of their selling efforts

Customer segmentation and targeting

Channel selection and management

Sales and service role definition

Sales and service organization structure

Sales compensation and performance management
Opportunity for Help!
Role of Sales…
The HR Organization’s Role
Human Resource Goals
Building a Talent
Portfolio
Leveraging TOTAL
Rewards Offerings
Demonstrating and
Measuring Value
Developing New
Functional
Capabilities
Role of Human Resources
Ten Key Functions
We are dedicated to providing the institution with value-adding services
in the following core areas:

Staffing and recruiting

Employee relations

Learning and development

Human Resource information systems

Compensation

Benefits

Communications

Payroll

Risk management

Strategic and organizational development
Purpose and Value of HR Service
And HR faces a related set of challenges…
OUR PERSPECTIVE
How do we leverage
HR to help our
colleagues become
better people
managers?
How can we respond to
the increased diversity
and mobility of our
workforce through our
compensation and
reward structures?
How can we work
proactively to address the
potential loss of key
management and staff as
they approach eligibility for
retirement?
How can we
control rising
compensation,
health and
retirement costs?
How can we assess the
impact of HR within the
context of an
institutional
assessment?
Can we balance the
need to increase
productivity and
manage costs while
retaining talented
management and staff?
How can HR use
technology/
outsourcing to help
us work smarter,
faster, and more costefficiently?
How can we design a
compelling HR value
proposition that meets the
increasingly demanding
needs of a wide range of
internal customers?
As does Sales…
Are we aiming and
executing in the right
directions?
How well to do
we know our
customers?
What is our current
growth capability?
Are we consistently
targeting the right
opportunities?
What are some
quick hits for
revenue
improvement?
Do we have as much
clarity into the
customers we don’t
have as we do with
current customers?
Are we using the
most effective
channel mix and
deploying optimally?
Are we flexible for the
customer, or do we want
the customer to be
flexible for us?
OUR PERSPECTIVE
How can we
leverage current
staff?
What is the
appropriate mix of
channels to reach
our overall growth
objectives?
Are we aligning
our organization
with the market?
What alternative
channels do we
need to reach our
growth objectives?
Are our management
jobs contaminated with
selling responsibilities?
These points of view can
sometimes become misaligned.
Misalignments are common among Sales and Human Resource
organizations. Best-in-class organizations realize this and work to
ensure both sides have a view into their peers’ world.
Fostering a Better Relationship Between
Sales and HR

Anticipating the financial, market and organizational
dynamics that may have an impact on the
organization’s future performance is not easy

Getting Human Resources and Sales working together
to anticipate financial, market and organizational
dynamics is the key!
Misalignments are common among Sales and Human Resource
organizations. Best-in-class organizations realize this and work to
ensure both sides have a view into their peers’ world.
First Step: Change your Thinking
Around Change…
We talked about the differences, but now add change. Address it first!
LETS TAKE A LOOK…
Change the Way You Attack…
With Human Resources and Sales there are typically four key
human factors that are commonly overlooked:
 Alignment of Project Teams (HR HEAD/Sales Head)
Alignment around change objectives, decision making authority, interfaces and
roles
 Involvement of Incumbents (Everyone Has a Role)
More Involvement and integration of divisions, functional groups, subsidiaries or
aquirees
 Communication to Stakeholders (Once a Week At a Minimum)
More Communication to ensure people are aware, understand and buy in to the
changes
 Organizational Design Impacts (Almost like Role Play)
Give Organizational Considerations around how the change would impact the
work and roles of functions and people
The majority of change issues arise because priority is placed on the change itself
rather than the organization and the people the change
is impacting
How to Sync-Up Sales and HR?
Second Step: HR needs to understand the Sales
business function and what is important

Acquire fluency

Understand what a
“first level-line manger”
is struggling with

Create a dialogue that
is helpful and useful
PAR, CCOS, VCOS, FCOS, SPA, Time in Motion Studies, Funnel Management,
Pipeline Yield, ETC
HR Adding Value to Sales - Get Tactical
Creating an “Early Warning
System”
HR with the sales organization’s
assistance, needs to create, use
and employ throughout the
organization a broad set of
financial and organizational
indicators as a system to help and
forewarn the executive teams of
future organizational challenges and
analyze what’s going on from both
sides’ perspective.
“Sync-Up” HR and Sales to Work
More Effectively
What is EWS, you ask?

A Broad set of Indicators that helps judge the
strength of an organization.

Three major asset categories:
1. Solidarity
of the customer base
2. Operational
3. Human
Efficiency
Capital Efficiency
Knowing these things can enable HR and the executive team to scan the
relative strengths of the sales force in each of the critical asset categories
Areas of Interest for Both Sales and HR
What does it mean?
Asset Category
Solidarity of the
Customer Base—
What is
happening
in the market?
Possible Indicators
 Is last year’s net new customers higher or lower than
customers lost? (What are expectations for this year?)
 What percent of sales volume comes from the top 20% of
our customer base? (Is this what it should look like?)
 Are sales per sale channel/distributor increasing or
decreasing?
 What percent of total revenues come from sales of new
products? (Is this what it should look like?)
 Has there been a significant market change in the industry?
 How do we rank in market share versus our nearest
competitor? (Is this acceptable?)
 Is our average margin increasing or decreasing relative to
competitors? (What does the future hold?)
 Is our revenue growth versus competitors increasing or
decreasing? (What does the future hold?)
Select a few of the most relevant to your organization.
Areas of Interest for Both Sales and HR
What does it mean?
Asset Category
Operational
Proficiency—
What is
happening
in the
organization?
Possible Indicators
 Is our cost of sales and G&A (general and administrative
expenses) as a percent of sales decreasing or increasing?
 Are profit margins increasing or decreasing? (Is this what it
should look like?)
 Is the sales force turnover rate decreasing, stable, or high?
 What causes turnover in the organization?
 Are sales and HR aligned in the hiring practices?
Select a few of the most relevant to your organization.
Areas of Interest for Both Sales and HR
What does it mean?
Asset Category
Human Capital
Efficiency—
What is happening
with sales?
Possible Indicators
 How many management levels does the sales organization have?
(Is this too few or too many?)
 What are the spans of control in the sales force? (Is this the
right level?)
 Are overall company labor costs as a percent of sales increasing or
decreasing? (What is causing this trend?)
 Is actual net income over the last two years above, below, or at
budget? (Where is it headed?)
 Is customer satisfaction increasing or decreasing? (Why?)
 Is quality (as measured by returns, write-offs, callbacks, back
orders) improving or on the decline?
Select a few of the most relevant to your organization.
Dashboard as an Early Warning System
By Leading cross functional teams to analyze the potential
upcoming speed bumps the sales force will be facing,
management can Forecast What Challenges lie ahead
and prepare to meet them.
How Does It Work?







Create a set of questions for each area that is specific to your
business (some should be subjective, others should be
quantitatively based)
Work to answer questions from both an HR point of view and a
Sales point of view
Answer questions not only based upon current data but
expectations for the future
Compare answers and scores from both organizations
Identify areas of concern on either side
Address these concerns and put programs, approaches, teams,
etc. together to help align perspectives or create solutions
You can also answer questions from each side’s perspective and
do a cross evaluation to compare views
Having both sides agree on assumptions and then consistently calibrating the
points of view creates an ongoing dialogue regarding organizational dynamics
and perceptions from a Sales and Human Resources perspective.
How to Get Started
To create and employ the early warning system, HR and Sales
should collaborate on four actions:

Refine: Select 4-5 indicators in each asset category that are the
most relevant.

Calibrate: Calibrate overall performance for each indicator.
Consider performance over the last 3 years.

Level of Importance: Weight the scores based on the relative
importance and accuracy of each indicator.

Rate: Compile the ratings for each asset category into an overall
score for each of the last 3 years and then evaluate the sales
organization’s performance in light of the score.
Creating An Early Warning
System to Track Issues or Change

Step 1: Refine the initial
framework. The high tech firm
chose 4 indicators to assess
the Solidarity of its Customer
Base:

Net new customers last year

Percent of sales volume from
the top 20% of the customer
base

Sales through average
distributor, and

Revenue growth versus
competitors
Creating An Early Warning System to
Track Issues or Change

Step 2: Calibrate overall performance for each indicator. The
firm then assembled a team of controllers, sales administration
representatives and HR managers to assess performance on
each of the four indicators for different performance periods. As
indicated the 2011 assessment found that:

Net new customers in 2011 was greater than customers lost,
meriting a rating of 4 on the gauge

Percent of sales volume from the top 20% of customers in 2011
was 65%, so that indicator got a rating of 5

Average sales through distributors were increasing somewhat, so
the team assigned a rating of 4

Finally, revenue growth versus competitors was on the upswing,
producing a rating of 5
Creating An Early Warning System to
Track Issues or Change
Step 3: Weigh the relative
importance and accuracy of each
indicator. The team weighted
each indicator from 1 to 4 with 4
indicating the most important
indicator of customer solidarity.
That weighting multiplied by the
performance rating determined
the overall rating for each
indicator. The ratings were
totaled to yield an overall rating
for the category. The customer
solidarity score for 2011 was 4.6
Indicators of Solidarity of Customer Base
Creating An Early Warning System to
Track Issues or Change

Step 4: Establish an overall score and then evaluate the sales
organization’s performance. The high tech firm completed the
exercise for the other two asset categories—Operational
Proficiency and Human Capital Efficiency. When those
assessments were completed, they compiled the ratings into an
overall score for each asset category.

Next, they evaluated the sales organization’s performance in light
of the score.

For example, if the trend is positive, is it positive enough? If the
indicators show stable performance, is top management
comfortable with that trend or should the sales organization be
reaching for more? If trends are negative, what can be done to turn
things around?
Creating An Early Warning
System to Track Issues or Change
Summary of all Indicators
Compare this score quarter over quarter, year over year, division to division to
establish trends
Recommended Implementation Plan
With both Sales and HR working together, the Kotter
Method, an 8 Step approach to managing change, becomes
easier. “A piece of cake”

The 8 Steps are as follows:
 Create Urgency
 Form a Powerful Coalition
 Create Vision for Change
 Communicate the Vision
 Remove Obstacles
 Create Short-term Wins
 Build on the Change
 Anchor the Changes in Corporate Culture
Conclusion

Once the performance indicators and the relative
weightings of an “Early Warning System” have been
developed, it is helpful to analyze the trends over 6
months and keep score over several years.

Trends over time provide a good indication of the sales
organizations overall health as well as the effectiveness
of the actions taken to reverse any downward trends.
Thank You
2018 Powers Ferry Road, Suite 850
Atlanta, GA 30339-5003
T 770.403.8006
www.sibson.com
Joe DiMisa
jdimisa@sibson.com
41