Over the last month or so, I’ve been hearing from our customers, my key contacts, and board of advisor members, that—in contrast to the last 10 years of economic growth—all signs are pointing to an economic slowdown.
Many people have been in the workforce for less than 10 years, so this will be the first time that many sales leaders will be managing a situation like this. What are they going to do? The last slowdown was in 2008-09. Are they going to try to dust off a playbook from 10 years ago? If you’re a leader who has never experienced this, how are you going to maintain the most vital leading indicator to your sales department, which is centered around sales pipeline?
Let’s dig into this question. In most organizations, during economic slowdowns your CFO will normally look at cutting three things:
2. Tools—because of the cost per seller.
3. Soft skills.
But aggressive companies—and those that came out of the 2008 financial meltdown that did well—bucked the trend and doubled their marketing budgets. They didn’t look at the market and see it as a necessary evil to retract; they saw it as a competitive advantage to double down and enhance the brand.
In a potential economic slowdown, your own deals will get tightened. Margins will get cut, and sales people will have trouble meeting their targets. In the 2008 recession, by doubling down on their marketing spend, despite it feeling risky, those companies that succeeded received more exposure.
That said, it’s a fact that CFO’s might not be willing to let you add to your headcount during a difficult economy. So how are you going to increase more yield and throughput with the sellers you have? If the CFO decides to reduce or stabilize headcount, or reduce things like tools per seller, how will you give them the skills to win in a tougher economy?
Looking at soft skills
I highly recommend looking at soft skills. If we use a sports analogy, your team isn’t adding anymore free agents or doing anymore trades—so as the coach, you need to create more opportunities for the team you have.
My advice is to prepare your sales force NOW in preparation for this economic slowdown, and think through these three questions:
1. Do I have the right teammates on the bus to prospect?
2. What percentage of my sales force will be self-sufficient, and which are too reliant on outside lead generation, such as channel partners or marketing?
3. What specific skills does my team need to learn to mitigate this risk? Find creative ways to be able to address those changes now, before your CFO suddenly won’t release funds for this.
The key is to acquire budget to invest in your team before these changes happen.