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On the importance of sales

posted: August 26, 2017

tl;dr: Sales is the most important functional area of a company, even if they don’t teach it in business schools...

I’m a product developer at heart, although I’ve worked in and managed other functional areas of companies. So you might expect that I would preach the importance of product development: “build a better mousetrap and the world will beat a path to your door”. But that’s not at all the way that the world works. Sure, it’s great to have a better product than the competition, and that’s what I’ve spent most of my career trying to do. Yet I believe that the most important functional area of a company is sales.

Nothing is more important to a company than customers. Without customers who are happy to pay more for a product than it costs to build it, there won’t be a company for long. Companies need to find customers and then focus on delighting those customers; if they can do those two steps profitably, they will survive and thrive.

The sales process is a bit more complex than Alec Baldwin's "Always Be Closing" lesson in the movie Glengarry Glen Ross

The importance of the sales function fundamentally derives from the fact that salespeople are the interface to the customer and a proxy for the customer. Sales is more than just getting the order: it’s also being the voice of the customer and providing accurate feedback and intelligence to the company on what the customer thinks and wants, what the customer’s options are, and what the customer is likely to do.

As the voice of the customer, salespeople behave differently than other employees of the company. It can often feel like salespeople aren’t 100% committed to the company. This is because they aren’t: salespeople also work for their customers, and when there is conflict, they will try to resolve it by pushing the company closer to the customer’s desires. Field salespeople who don’t often visit company headquarters or a major company facility will seem to be only nominally part of the company. This is actually the way it should be: you want salespeople spending as much time with customers as possible, and relaying back the customers’ (not the company’s) views of the world.

If you want to make the most money in business, don’t get into product development: get into sales. I’ve seen salespeople make more money in a good year than the CEO. Don’t be upset when the salespeople are cashing huge commission checks and driving around in fancy sports sedans; it probably means the company is doing well too. Sales can be a brutal profession. Salespeople must be able to emotionally handle constant rejection. Most salespeople operate on quotas: if they make their number life is good; if they don’t make it (for whatever reason, whether their fault or not) they are often gone. It’s pretty straightforward to objectively measure the performance of a salesperson: what is the dollar value of the orders placed by his/his customer accounts? It’s a little bit harder to objectively measure the results of people who work in other functional areas.

For all the importance of sales, they don’t teach sales in most business schools. At the nation’s top business schools a student can typically focus on general management, finance, accounting, marketing, operations, human resources, and entrepreneurship. Not only is there not typically a sales focus, there may not even be any classes on the sales process.

Why don’t business schools teach sales? I think it is because of a mistaken, diminutive view of the sales function, combined with biases against the type of people who go into the sales profession. Marketing is viewed by many as a more elevated profession: in this view the marketing folks determine the product line strategy, the products’ features and price points, and the marketing campaigns to generate interest in the product; then they just hand off canned presentations and brochures to the salespeople, who knock on doors, tell the customer exactly what the marketing folks have told them to say, and ask for the order (i.e. "Always Be Closing"). This is a huge misunderstanding of the collaborative sales process.

Salespeople necessarily have a different personality type than others who work in more inward-facing roles in a company. The salespeople tend to be more gregarious, extroverted, and less analytical. The sales personality type tends not to do as well as other personality types in structured academic environments.

In addition to being the voice of the customer, salespeople are also the face of the company. They are the company personnel who spend the most time with customers. When customers think of the people who work at your company, the first person they are going to think of is the salesperson who shows up most often at their site. You want your salespeople to represent the company well, in a professional manner. This is another reason you need good salespeople.

Salespeople are closest to the customer. Product development people are closest to the product. When the two types of people get together and interact positively, great things can happen for the company.