SHIFTING THE SALES PARADIGM

Impact of Group Dynamics on Performance

We all experience group dynamics daily in the companies we work for and in our personal lives, including following the emergence and popularity of new ideas and technologies.

Three primary factors that affect a team’s ability to work together well include the environment, the individuals and leadership.  Positive and negative forces within groups of people also include a collective aspect, public or tribal knowledge.

A widely accepted notion is ‘the whole is greater than the sum of its parts.’  However, a struggling group can devolve to an earlier stage of development and function, if unable to resolve outstanding issues at its present stage. This can relate to the group associations and processes which are often unseen and not acknowledged, as opposed to content, structure and rules.  One important fact to consider, a social group is an entity that has qualities which cannot be understood just by studying the individuals that make up the group.  In fact, the properties of any of the parts are determined by the inherent structural laws of the whole.  For example, several processes engaged by the group can take on an orientation which obstructs the ability of the group to achieve the work it is engaged in.

Groups are successful when they satisfy internal and external clients, develop capabilities to perform in the future, and when members find identity, meaning and satisfaction in the group.

Intragroup dynamics

There is a state of interdependence, through which members of one group are collectively influenced by, or influence, another group’s performance.  For example, when action is needed, depending on the task requirement, either facilitation or interference will affect the outcome of the task. If facilitation occurs, the task will have a response from the individual resulting in better performance.  If interference occurs the task will have a response from the individual resulting in sub-par performance of the task.

Interdependence

Consider the functional areas within a company that support and impact performance within the sales organization, including corporate leadership, administration, finance, marketing, and human resources.

There are techniques for increasing performance that utilize interdependence between two or more groups. That is, members across groups rely on one another to achieve goals and tasks.

Examples of Best Practices for maximizing intragroup performance include:

  • Enable channels for contact between groups
  • Ensure there is equal status between the groups in the situation
  • Establish common goals for each situation
  • Promote intragroup cooperation

Functional Formulas for Success

Often functional areas within an organization are independent but play a supportive role to other functional areas within specific situations.  There are times when collaboration is the activity of the day, but often these situations are loosely defined and inadequately formalized.  Consider the role of marketing.  A few of the tasks assigned to marketing include sales lead generation, brand development, Point-of-View presentations, sales playbooks, etc.  Yet, within the past several years buyers have relied more than ever on Omnichannels for information before they even have a first conversation with a sales organization.  The result has been an expansion of marketing’s role in the direct sales process. The effects of supportive roles and behaviors on other groups can be profound.

Collaboration between groups with a positive dynamic is easy to spot. A high level of trust in one another, working towards a collective decision, and holding one another accountable for making things happen. Also, when a team has a positive dynamic, its members are nearly twice as productive as an average group.

Compounded Impact on Performance

The contribution from and collaboration with functional areas outside sales can have a compounded impact on sales performance. In fact, the most successful sales organizations rely on formal, open collaboration across functional teams to address the requirements of change.  A few of the criteria for success include:

  • A common agenda, including a shared understanding of challenges and a joint approach to solving them through agreed upon actions.
  • Assessments and measuring results consistently across all the functional areas ensures shared measurement for alignment and accountability.
  • A plan of action that outlines and administrates mutually reinforcing activities for each contributing functional organization.
  • Open and formal communication is needed across all functional areas to build trust, assure mutual goals, and create common motivation.
  • Active engagement and commitment of leadership to drive the initiative and coordinate participating functional organizations.

Functional Impact Metrics

In the following example, contribution from and collaboration with functional areas outside sales has a significant effect on sales pipeline volume, velocity, veracity and additionally affect the win rate and average deal size.  Each factor alone would have much less of an impact on the growth of overall sales revenue.

Here are a few additional examples of functional maturity that can improve contribution to revenue growth:

  • Finance has a clear understanding of the drivers for deal growth over time, the ability to cross/up-sell, and reasons why each deal was won/lost
  • Sales Operations knows the top and bottom performing customers, sales channels, products, branches, segments, reps, etc.
  • Human Resources has metrics to measure the competencies and traits of the consistently high-performing reps
  • Marketing measures effectiveness of each of the marketing campaign elements, in terms of its contribution to sales-volume, effectiveness (volume generated by each unit of effort), efficiency (sales volume generated divided by cost) and ROI
  • Sales understands which sales rep activities drive opportunity creation and which close deals

Impact Example

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