Insight Snapshot

THE CASE FOR COACHING

MANAGER COACHING

CALL FOR ACTIONTo improve coaching quality, companies should equip managers with a common understanding and framework for high-quality coaching, helping them target their coaching efforts at the areas of highestreturn in terms of long-term rep development and sales performance.

INSIGHTOur research shows that coaching quality has a large impact on sales performance as coaching allows for sellers to more deeply understand how to improve in their sales approach. Indeed, our analysis shows that high-quality coaching can improve seller performance by up to 19%.What many organizations under-appreciate is that coaching has the highest impact on the core performers and, instead, spread their coaching efforts evenly across all sellers misallocating limited managers’ time and resources.

Prop

ortio

n of

Reps

10%

50%

40%

30%

20%

Improvement in Sales Performance Depending on Coaching Effectiveness

Gap-to-Goal

83% 102%+19%

Lowest Levelof CoachingEffectiveness

Highest Levelof CoachingEffectiveness

Population Scoring Coaching Effectiveness as a 1 (i.e. very ineffective)

Population Scoring Coaching Effectiveness as a 7 (i.e. very effective)

INSIGHT SNAPSHOT

CHALLENGEIncreasing deal complexity pushes many managers to frequently parachute in to save deals while deferring coaching opportunities. Although this “executing” versus “coaching” approach helps close deals in the short-term, it adversely affects individual rep’s long-term skill development.

Distribution of Relative Sales Rep Performance by Coaching Effectiveness

To account for different distributions dependingon sales context, gap-to-goal numbers were converted to deciles

0Bottom 10%

(Equivalent to

0.5Median

(Equivalent to

1.0Top 10%

(Equivalent to<60% of goal) ~ 100% of goal)

Relative Sales Performance> 140% of goal)

2© 2019 Challenger Performance Optimization, Inc.

MANAGER COACHING

CALL FOR ACTIONTo improve coaching quality, companies should equip managers with a common understanding and framework for high-quality coaching, helping them target their coaching efforts at the areas of highestreturn in terms of long-term rep development and sales performance.

INSIGHTCoaching Effectiveness Drives Performance: Teams that report receiving high quality coaching are far more likely to over-perform than teams receiving low quality coaching

Coaching Affects Retention and Engagement: While the best coaches drive up retention and effort from their teams, low performing coaches create a fundamentally demoralizing environment

INSIGHT SNAPSHOT

CHALLENGECoaching is highly infectious whether good or bad. Substandard coaching has both a negative financial impact and a devastating effect on seller retention and discretionary effort2

3© 2019 Challenger Performance Optimization, Inc.

83%

97%

102%

75%

90%

105%

Low Medium High

Coaching Effectiveness1

Difference in “Intention to

Stay at Company”

from the Mean

Seller Percentage to Goal by Coaching Effectiveness

Seller “Intention to Stay at Company” by Performance and Coach’s Effectiveness

-0.63

-0.07

-0.27

0.70

0.58 0.57

-0.80

0.80

Below Average Coaches1

Top Coaches1

Low Performers

Average Performers

Star Performers

Average Seller

Attainment to Goal

Source: Sales Executive Council research1As determined by each manager’s direct reports2Findings are based on a survey of more than 2,600 reps and managers from 40 global Fortune 500 Companies

Owning( 45.4% )

Key finding #1Owning the business has a greater impact than coaching on manager effectiveness

MANAGER INNOVATION

CALL FOR ACTIONTo improve coaching quality, companies should equip managers with a common understanding and framework for high-quality coaching, helping them target their coaching efforts at the areas of highestreturn in terms of long-term rep development and sales performance.

INSIGHTOur research has found that sellers need significant manager assistance to help them think creatively about moving these deals through their pipelines. This creative deal support is called Sales Innovation, and, according to the research, it accounts for nearly one third (29.2%) of manager effectiveness. While coaching focuses on correcting rep behaviors, sales innovation focuses on identifying new paths to “unsticking” stalled deals.

Selling• Offering customers a

unique perspective• Tailoring offers to

customer needs and priorities

Coaching• Guiding reps to tailor

effectively• Showing reps how

and when to assertcontrol

Resource Allocation• Driving sales process

compliance• Taking corrective

action

Sales Innovation• Generating new ways

of solving deal-level problems

• Innovating new ways to position an offer

Impa

ct O

n Sa

les

Man

ager

Effe

ctiv

enes

s

INSIGHT SNAPSHOT

CHALLENGEAs suppliers are selling more complex products and services, customers have also introduced more complexity into their purchasing process — more customization demands, more stakeholders involved in the purchasing decision. This added complexity often results in “stalled” deals, deals that are not moving forward, deals that clog pipelines and often waste sellers’ time and effort.

Sales Management Attributes Impacting Manager Effectiveness

28.0%

16.2%

26.6%

29.2%

Selling( 26.6% )

Coaching( 28.0% )

Key finding #2Improving sales innovation skills has nearly twice theimpact of resource allocation on manager effectiveness

n = 5211.Note: Management Fundamentals account for 26.6% of manager effectiveness and sales management ~ selling, coaching, owning ~ accounts for the remaining 73.54%

4© 2019 Challenger Performance Optimization, Inc.

CALL FOR ACTIONTo improve coaching quality, companies should equip managers with a common understanding and framework for high-quality coaching, helping them target their coaching efforts at the areas of highestreturn in terms of long-term rep development and sales performance.

MANAGER-LED CLIMATE OF JUDGMENT

INSIGHTWinning organizations build a different kind of climate — climate of judgment — empowering sellers to use discretion in making good business decisions and exercise their judgment. Our research demonstrates that organizations with this kind ofjudgment-oriented sales climate see a 23% increase in rep adoption of Challenger behaviors and a 9% increase in discretionary effort, yielding a 3% increase in total sales productivity. Sales managers play a key role in creating a climate of judgment by flipping their role from “directive” to “supportive”.

FacilitationServe as a connector and a collaborator within and beyond the team

Long-Term FocusEncourage cultivation of a business pipeline. Prioritizing smart growth and a forward looking mindset overexpediency

Informal CommunicationInstill a habit of regular and informal upward, downward, and lateral communication.

Participatory Decision MakingInvolve the team in jointly thinking through commercial and business challenger, broadly supporting one another.

INSIGHT SNAPSHOT

CHALLENGESelling to more educated customers and adopting a Challenger approach results in greater variability for sellers. Throughout the sale, sellers must infer, adapt, and anticipate customer reactions and possible roadblocks, which require greater individual discretion and judgment. However, the existing sales climate of most sales organizations today is dominated by compliance orientation and activity-based selling. It prevents sellers from exercising judgment and, in turn, from transforming their selling approach.

Comparison of Dominant Front Line Management Styles

DIRECTIVE

SUPPORTIVE

Source: CEB Sales Leadership Council, 2013

5© 2019 Challenger Performance Optimization, Inc.