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Have you ever found out that something you believed to be obvious and true is completely wrong? Just because it's conventional wisdom, doesn't mean it's correct. Well the same goes for sales, and we wanted to separate fact from fiction, so we sat down with Frank Cespedes, Harvard Business School professor and sales expert, to separate the signal from the noise.
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Frank gives us his take on how he thinks sales is changing (and will continue to change), the role of marketing in supporting sales teams, and the three most important activities sales leaders should be focusing on right now. (Don’t worry there won’t be a test).
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Q: In your book, you say that much of the conventional wisdom about how new technologies will impact sales is wrong. Can you give us an example of what you mean?
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A. Technology changes fast, but buying changes more slowly. For example, it’s common to say that e-commerce and social-media channels mean the demise or “disintermediation” of sales forces, face-to-face interactions, and stores; and that the pandemic has dramatically accelerated that trend. But here’s the data: after 30 years free from sales taxes, e-commerce as a percentage of total retail sales in Q1 of 2020, just before the pandemic shut or limited capacity in stores, was 11.4%. That’s Department of Commerce data, and e-commerce includes any sale of goods or services over an internet-connected device whether payment is made online or in a store. So it’s a generous definition of e-commerce.

What happened during the pandemic? Well, so far maximum lockdown conditions were in Q2 of 2020 and e-commerce as a percentage of retail sales that quarter was 15.7%--a gain of about 5%, even in maximum lockdown; and it has been trending down every quarter since then. It was down to 13% by Q3 of 2021. Yet, when I ask executives what the number is, I routinely get estimates between 30 – 60%. In other words, executives are often orders-of-magnitude mistaken in their assumptions about buying.
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Q: Twenty years from now, how do you think sales will be different? How will it be the same? 
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A. “Predictions are risky, especially about the future.” I don’t know, and neither do the many pundits and consulting firms currently making glib “new-normal” predictions. But the most important thing about sales is the buyer: who buys, why, and how. It is now and likely to be an omni-channel buying world twenty years from now. That demands a multi-channel sales response and, in turn, that affects core areas of sales management, including hiring, customer contact, and the ability to monitor and manage online / offline interactions in buying and selling.
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For example, sales hiring has always been difficult. Unlike other business functions, there is no natural resource pool or educational priors for sales. If you want to hire an engineer, you can go to a school and pick from electrical engineering, mechanical engineering, and so on. If you need a finance or accounting person, you can find people who majored in those subjects. The same is true for computer programmers. But very few colleges and universities even offer a sales course, let alone a sales degree, and sales tasks vary greatly depending on the product or service sold. Sales hiring is tough and it’s getting tougher as data-analytics reshape required competencies and time-to-productivity in many sales forces.
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Another example: while the numbers vary by industry and company, on average most salespeople only spend about 30-35% of their time in customer contact (and that includes emails, demo’s, webinars, as well as pitching a product either virtually or in-person). Think about the impact in most businesses if you can increase that by 10-20%. That’s not only a major productivity improvement; it also increases the addressable market of your firm, because segments that were uneconomic to reach become economically feasible with better utilization of sales resources. 
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In services-dominated economies like the U.S. and as software becomes a bigger part of many products and services, what accountants call Selling, General, and Administrative expenses (SG&A)—and especially the S part--have steadily increased as a percentage of firms’ total costs, while COGS has decreased. I predict that once we get past current supply-chain constraints, increasing sales productivity will rise in company priorities throughout the next 20 years.
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Q: In your opinion, what are the three most important things a sales leader should be focusing on right now? (aside from hitting quota, of course)
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A. Deployment. Both data analytics and the pandemic reveal that, in effect, many companies have basically been over-paying for many tasks in their sales models. It’s often not necessary to have the most-expensive reps do lead generation; you can do that with less-experienced, lower-paid people or via marketing algorithms in many cases. Similarly, many product demo’s, and a number of meetings throughout the selling cycle, can be conducted online. 
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Sales leaders have levers under their control to affect deployment of sales resources, and C-level productivity discussions should focus on where expensive sales resources are deployed and have the most impact versus marketing, customer success, or other resources in the firm. 
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Pricing. In a changing landscape, pricing can build or destroy profits faster than any other business action, and in most firms the sales force frames price and the value proposition with prospects and customers. Current supply-chain conditions allow many companies to increase price, but linking price and value will be an on-going challenge and opportunity. Customers now have easy access to product and price comparisons in both B2C and B2B markets, and if inflation becomes rampant, price changes will also need to be made more frequently. 
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Buying changes and data analytics have made value-pricing approaches (vs common cost-plus approaches) more possible in many categories. With new tools, price testing can be an ongoing part of sales models. But there is a lot of inertia about price testing in many companies and, because their compensation is often tied to volume metrics, sales people resist price changes: when you lose a deal, how often have your reps said it was because your price was too low? 
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Performance Reviews. Markets don’t buy; only specific customers do. As buying changes, much important information about who buys, why and how is lodged in the heads of account reps, not in the CRM system. And that’s especially true as we emerge from a pandemic that caused many companies to alter their purchasing processes and criteria. So when sales managers do sloppy or drive-by performance reviews, they not only perpetuate a culture of under-performance; they also inhibit the flow of vital information throughout the company.  
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Q: What is an example of a company that failed because their sales teams didn't adapt to change?
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A. In my experience, when companies fail, it’s because their business models failed to adapt, not just their sales teams. Even the best sales teams cannot substitute for a relevant and coherent business strategy. Conversely, there is no such thing as effective selling if that selling does not support strategic goals. Sales is a core strategy implementation function and source of market information, but the end game in business is enterprise value, not simply top-line sales motion.
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That said, managing change is always difficult in sales. So many other company plans and resource decisions depend upon sales forecasts and the ability to meet those forecasts. Sales and marketing are therefore typically under pressure to “make the numbers” weekly, monthly, or quarterly, and their metrics usually reinforce current business-development activities. A common result is that sales leaders seek to avoid transition costs and stick with the devil they know despite changes in buying processes. And that’s one way companies get disrupted.
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Q: What is something most people believe about sales that isn't actually true?
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A. Sales is very context-specific. Selling software is different than selling capital goods or supply items or professional services and so on. Selling multi-year licensed software products is different than selling SaaS. Selling in North America differs from selling in Latin America, Asia, the Middle East, or Europe. But it’s also the area where people make big generalizations usually unsupported by any data beyond N = 1: “When I sold for X, we did it this way and so should you.” And remember that sales training firms have an incentive to apply their particular methodology everywhere, not only in the sales situations where  that method does legitimately apply. 
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For example, most people have a stereotype—reinforced by the media—of a salesperson: “pleasing” personality, deep inventory of stories and jokes, “hard wired” for sociability, and so on. But nearly a century of research uncovers no consistent correlation between personality characteristics or demographic traits (e.g., age, education, gender, years of sales experience) or psychological qualities (e.g., “emotional intelligence”) and actual sales outcomes. Factors that correlate with better sales performance in some contexts are negatively correlated with results in others. Sales is a performance art and so much depends on the particular sales situation. 
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The take-away for sales leaders is that sales talent comes in all shapes and sizes, but there is no such thing in sales as “high performance” in the abstract. There’s only performance (or lack of performance) in your context: in your market with your products and prices at this stage of the business. Sales leaders get paid to figure out how that context works today, not yesterday, and the implications for hiring, training, coaching, and on-going performance management. 
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Frank Cespedes teaches at Harvard Business School and is the author of many articles and six books, including Sales Management That Works: How to Sell in a World That Never Stops Changing (Harvard Business Review Press, 2021): order here.