Why More Salespeople May Not Be the Answer

When a company wants to increase sales, adding salespeople is an obvious option.

More salespeople should mean more sales.

Sometimes it does.

But adding people to an existing sales organization before understanding how effectively the current organization is performing can be an expensive way to address the wrong problem.

Before increasing sales capacity, it is worth determining whether the organization is fully using the capacity it already has.

The Existing Sales Organization May Have Untapped Capacity

Many sales organizations have some degree of unused capacity.

That capacity may exist because:

• Salespeople are spending too much time on low-value activities.
• Prospecting is inconsistent.
• Leads are not being followed up effectively.
• Opportunities are not being properly qualified.
• Sales presentations are inconsistent.
• Pipeline management is weak.
• Sales managers are not providing enough coaching or accountability.
• CRM information is incomplete or unreliable.
• The sales process creates unnecessary delays.
• Performance expectations are unclear.
• Compensation does not reinforce desired behavior.

Adding salespeople does not automatically correct any of these conditions.

In fact, adding people can make an inefficient sales operation more expensive without addressing the underlying problem.

More People Can Multiply an Inefficient Process

Suppose a company has an inefficient sales process.

Adding ten more salespeople means ten more people working within that process.

If the process is producing unnecessary delays, inconsistent follow-up, poor qualification, or weak pipeline visibility, the company has not solved the problem.

It has expanded the number of people experiencing it.

The same principle applies to management.

If sales managers do not have effective performance measures or accountability systems, adding salespeople increases the management challenge as well.

Growth in headcount is not the same thing as growth in effectiveness.

Look at Productivity Before Capacity

There are two different questions:

• Do we need more salespeople?
• and
• Are our existing salespeople producing what they reasonably could?

The second question should often be examined before answering the first.

That does not mean companies should avoid hiring.

A company may genuinely need additional sales capacity because the existing team is operating effectively and there is more qualified opportunity than the current organization can handle.

But that conclusion is much more useful when it is supported by evidence.

What Would Greater Effectiveness Look Like?

A properly functioning sales organization should have reasonable visibility into:

• Sales activity
• Lead generation
• Lead response
• Opportunity creation
• Pipeline movement
• Conversion rates
• Sales-cycle length
• Individual performance
• Team performance
• Forecast accuracy
• Revenue and profitability

The purpose of measuring these areas is not to create administrative work.

It is to determine where sales capacity is being used effectively and where it is being lost.

Existing Capacity Can Often Be Improved

Improving the existing organization may involve relatively straightforward changes.

It could mean improving prospecting.

It could mean establishing better qualification standards.

It could mean improving sales presentations.

It could mean eliminating unnecessary steps in the sales process.

It could mean improving follow-up.

It could mean giving sales managers better information and stronger accountability.

It could mean addressing individual performance issues.

Or it could involve several of these simultaneously.

The important point is that the appropriate response should come after the organization understands where its capacity is being lost.

Then Determine Whether More Salespeople Are Needed

Once the existing sales organization is operating effectively, the question of additional salespeople becomes much easier to evaluate.

If the organization has:

• A sound sales process
• Effective sales management
• Consistent execution
• Reliable pipeline management
• Appropriate performance measurement
• Strong lead generation
• Effective conversion
• Demonstrated market opportunity

then additional sales capacity may make considerable sense.

The issue is not whether hiring salespeople is good or bad.

The issue is whether the organization is ready to make that investment intelligently.

Improve First. Scale Second.

The objective should be simple:

Make the existing sales organization as effective as it can be. Then determine whether additional sales capacity is necessary.

That approach gives management a better understanding of where the opportunity actually exists.

It also provides a stronger foundation for growth.

Adding salespeople can increase capacity.

Improving the organization can increase effectiveness.

The most useful strategy depends on which of those the company actually needs.