Building and managing a sales team is Rob Merklinger‘s specialty. In fact, over the past 12 years, Rob has put together a diverse resume, encompassing sales management in a variety of different roles at various software companies. Starting out at Oracle, Rob rose from the ranks of a regional sales manager there to become the Director of Sales at Gomez and, for the past 3 years, has served as the VP of Sales at Intronis. Needless to say, he knows what he’s talking about when it comes to sales processes and sales tactics.
We recently had the pleasure of speaking with Rob and picked his brain on how he manages his sales teams, how he deals with missing quotas and what he wish he knew throughout his sales career before he became a Sales VP.
1) One of the keys to managing sales reps is helping them focus – on tasks, specific types of opportunities, etc. How do you manage this?
Reps need to understand clearly what is in it for them if we choose to focus on something new. I realized there are a lot of MSPs that are different, at different points in building their business. We focused all of 2013 on identifying these larger MSPs, those that are willing to spend a certain threshold with us each year. We then took our sales team and shifted our focus just on those larger MSPs. We saw our win rates more than double, our average sale price grow by more than 60%, we saw our average sales cycle drop from more than 30 days down to 20 days.
All from focusing, and the reps really understood the impact this was going to have on the business but more importantly their own business. Together as a team we created what our new discovery questions would be and some of the changes we wanted to make in our sales cycle. Making them part of the process really helps out, they feel like they are part of the strategic decisions that are being made. When reps feel they have a voice in the change we are making they are more likely to rally behind the new approach.
2) What’s your quota / number of opportunities per quota-carrying rep on monthly recurring revenue (MRR)?
About $60k a month, or $650k for annual bookings. When we built out our models, we built it based on what we knew we did in business in 2013, and then realized we had a capacity problem. We weren’t at full capacity the entire year. We weren’t doing it with a lot of lead scoring or nurturing – it was all pure cold calling. From the belief that we can keep our average sale price the same and win rates the same, we thought that if we add a little bit more head count around our cold-calling efforts, we can get a little bit better at having more conversations and bringing in technology that can help our team be more efficient, such as an auto-dialing tool.
Currently, at any point in time, each of our reps probably has about 20-30 opportunities in their pipeline. We want to increase that to about 40. I look at win rate as a resolve rate: the number of opportunities that you’ve closed-won over the number of opps you’ve either closed-won or closed-lost. It’s a different number than looking at it as a pure competitive win-loss. Then, we break it down based on what was a competitive win versus a no-decision win or no purchase rate.
3) How many sales calls, activities or opportunities generated do you require from your reps?
Last year it was 50 calls a day; this year, it will be closer to 70-75 calls per day. For the cold-calling team, we track the number of cold calls you make, but what I really care about is the number of conversations you have and the conversion rate from conversations to qualified opportunities. A conversation is more than just scheduling a meeting.
If you remember what I was saying, all we did in 2013 was focus on larger MSPs. We built a qualification guide which we call our 9 questions, and you have to answer 6 out of the 9 questions in order to become an opportunity. If you answer 8 or more, you are an A opportunity. If you answer 6-7, you’re a B opportunity. Anything below 4 is a C opportunity and is now allowed in our pipeline. These questions are not your typical BANT questions, some of it is in there. It’s about, “Is this the right buyer for us given what we know we want to go after?”
Each outbound rep should be generating 1.2 opportunities per day, on a 20-day sales cycle. We built this based off of daily activities, accounting for all the holidays plus their full 15 days of vacation.
4) How did you design your sales process and why is it effective for you?
The big thing for us is making sure we obviously get the right people to come in. Our business keeps growing after the first sale. Keep in mind we’re selling to the IT channel and they go out and resell our products and services.
Once it becomes a qualified opportunity from our cold-calling team, it goes to our deal closers. The first stage is discovery. We’re taking the 9 concept questions we’ve done with our cold-calling team and we’re incorporating that into each stage of the sales cycle but we want to go deeper and really understand the business and technical impact. In the discovery stage, there will be more BANT questions that the reps have to ask. We talk about taking the prospect on the Pain Train – a series of questions to really quantify the impact of the pain. We are trying to capture the technical first and then the business win.
After we understand their pains we set up a demo. We’re not going to give everyone the same demo. We’re going to demo only to the criteria that you’re using to make your decision and the criteria you need to make sure that your customers are able to achieve certain industry or compliance regulations. Once we have done a demo we will normally set up a trial so they can see their business in our software. It is important for them to experience the full service we offer.
During the trial we shift to focus on getting the business win so that we can close the deal in under 25 days. After this we go get the deal and start to set the stage for the onboarding.
5) As a Sales VP, what are the key lessons you’ve learned throughout your career? What are some things you wish you knew before you became a Sales VP?
Starting off, I think it’s all about the dollars that you spend and the dollars you get. Anyone can build a sales model, but you have to take into account the cost of acquisition and you have to work closely with marketing on that. I think sales guys can either put together a model of fulfilling a quota, but are you doing it at a cost that is helping or hurting the company?
The second thing I would say is, I think most sales reps are afraid of change. No one wants a new territory or a new quota. Sometimes sales managers are afraid to change. We have to embrace testing. I think our friends on the marketing side do a great job of testing things all the time, and I think sales needs to get into a rhythm of doing that as well. It can be as big as testing a new market or testing a new question that you want your sales reps to ask. Let your reps be a part of this culture experimentation. They need to feel like the culture is one where they can say, “Hey, if I come to the table with an idea and it’s a good one, we’ll test it.”
6) How do you react or respond when you encounter a roadblock like missing quota?
The hardest thing for me, and if I could do it all over again this is what I would do differently, is you have to understand your business and the ins and outs of why this is happening vs. why this is not happening. You’re going to miss your number at points in your career – anyone can say it’s not a good enough product or you didn’t have enough leads, but if you really take a step back and look at your business, you’ll realize that you probably missed your number by each rep not having an additional deal they could close. Which really means that they didn’t have the right number of opportunities in their pipeline, and you could tie it back to being one head down on the cold-calling team. I think this was hard for me in the beginning because I didn’t have a solid model that really looked the ins and outs.
7) What’s your sales coaching style like? What kind of meeting cadence do you have?
We meet as as entire sales team to present metrics every Monday morning at 10:16. Everyone remembers 10:16, not 10:15 – it becomes embedded in their mind. In these meetings, we go over a numbers update from the entire sales team. We talk about the lead generation team. Everyone sees all their metrics, especially their pipelines. We view a small kind of did-you-know training or update about the industry or a competitor, and then we have action items to focus on or be aware of for the month or the week.
Throughout the week, We meet with each deal closer one-on-one for an hour to go over their deals and their pipeline. We spend a little bit of time talking about the deals they closed. we spend a lot of time talking about deals that they’re working on, especially early in the sales cycle. My belief is to be involved in the beginning – I can bring a lot more value early versus at the very end.
The other thing that we’ve been working on is, for 45 minutes once a week, we sit down and every deal closer brings a deal early on that they’re struggling with or unsure about, and we break it down as a team. Each deal closer brings in an early stage opportunity, and we ask them to give an overview, where they’re concerned and we just open it up for questions.
8) What are going to be the biggest differences or trends in sales over the next 5 years?
I think there’s no doubt – and we’ve already seen this with companies like InsightSquared – that technology is going to have a huge impact on sales efficiency and productivity, while also understanding the buyer. The buyer’s journey changes and evolves as technology changes, so I think there’s going to be a lot more technology that reps can use to understand where the buyers are and what we can to move them forward.
Sometimes, people say, you know, “Death of a Salesman,” they’re going to find a way to automate everything. I don’t believe that. I think sales isn’t going anywhere. If anything, our jobs are just evolving. Sales reps need to make sure they stay on top of the cutting edge and really understand what’s going on in their marketplace.
More about Rob Merklinger
Rob Merklinger has been the VP of Sales at Intronis since July 2010. Prior to that, he spent 2 years as the Director of Sales at Gomez and nearly 6 years in various sales and sales management positions at Oracle. He graduated from the University of New Hampshire in 2000.
Connect with Rob on LinkedIn.