The sales team is the powerhouse of revenue generation in every organization. The sales team handles intrinsic sales tasks from selling a company’s product or service to networking, cold calling, sending out cold emails, or even following up with clients and prospects with the sole aim of increasing sales and revenue for your organization.
Although different factors such as the qualification of the sales rep, their sales specialization, and other personal issues can affect the performance of the sales reps. So much more goes into the smooth operation and success of the sales team – one of these is the sales team structure.
Your sales team structure is the foundation of your sales operations. The way you design and structure your sales organization can have a lasting consequence for your sales and business’s long-term success. If your foundation is weak and undefined, your entire sales process and performance would suffer.
If you want to scale your efforts and coordinate the operations of your sales team, you need to set up a solid sales organization structure that will help you boost your growth and business profitability.
While we continue to emphasize sales organizational structure, it is important that you know that the process goes beyond just hiring smart sales representatives to ensure that the reps are well set up to thrive and succeed. In this article, we have identified the seven most important types of sales team structure, and practical tips to create a winning sales team structure.
Sales organization structure in simple terms refers to the design of the sales team, it is basically how you segment your sales team into different roles or departments.
Due to the different specialties in sales such as inside or outside sales, customer service, email marketing, or a combination of any of those, etc., sales teams can be structured into different models. For example, sales teams who specialize in either inside sales or field sales can be split between business development reps, sales development representatives (SDRs), and account executives
Creating a well-structured sales team helps you assign everyone their distinctive role and identify the strength of every team member to boost sales performance. A sales team structure goes beyond just setting up the front-facing structure to working on the internal organizational structure for your business.
It also focuses on the effective coordination of the sales team by arranging their workflow and assigning tasks to every sales rep. Structuring your sales team helps you to coordinate the functioning of the team and enhance the sales performance, but you need to understand that not all structure works for your type of business.
To choose the most appropriate structure for your business, you will have to go through some trial-and-error to find the right fit. Essentially, you also need to understand that the sales team structure could be determined by factors such as,
Sales organizational structures can be divided into two types – centralized and decentralized systems.
1. Centralized Structures:
A centralized structure relies on a single point person to make and manage major decisions for the team. A centralized structure keeps all levels of an organization focused on a single purpose and is best appropriate when the business owner is heavily involved in the company.
Using a centralized structure has been reported by experts to enable faster communication and execution of decisions.
2. Decentralized Structures:
On the other hand, decentralized structures allow for sharing of decision-making responsibility among teammates. Unlike a centralized structure where this role is fixated on a single person, a decentralized structure allows sales reps to split into groups headed by sales professionals/managers.
Using this structure has been reported to give sales representatives more freedom to decide on the best way to work.
A sales organizational chart is a record that shows the position of every sales reps in the sales teams. For clients and other stakeholders, a sales organization chart is a sales prospecting blueprint that can be used to identify decision-makers at target accounts.
Below is an example of a sales organization chart from Lucidchart
A sales department is responsible for generating revenue and making sales for the company/business. They handle a lot of sales-related tasks from networking to cold calling, sending cold emails, following up with old and new clients as well as nurturing the prospects to a sale.
The success of an organization is highly dependent on the plans, activities, and organization of the sales department. Most sales teams have the following roles:
Most sales organizations have a sales director whose role and responsibility is to oversee the strategic leadership of the sales department.
They are also in charge of setting the sales targets, measuring the team’s KPI, and coordinating the overall sales performance of the sales team.
Sales managers mostly report to the sales director and are charged with the responsibility of managing sales teams by recruiting, training, and mentoring the sales force. They are also in charge of creating timelines and goals for the sales reps and creating the sales reports.
Although hiring is the responsibility of a sales manager, most organizations have hiring managers that are in charge of talent acquisition, onboarding, and employee retention.
In a much bigger organization, these tasks are handled by the human resources department, where a whole team manages recruiting and team engagement.
As the name implies, a sales trainer is a professional charged with the responsibility of improving the performance of the sales team by providing the reps with the proper tools, resources, and skills needed to thrive in the sales role.
These individuals are also responsible for orienting recruits about the sales process, structuring training plans, and evaluating the sales reps’ performance.
Essentially, sales representatives are the face of a business and are mostly responsible for promoting the benefits of a company’s products or services to clients, prospects, and the target market in general.
Sales reps are also in charge of generating leads, identifying prospective customers, providing resources and support for clients, and importantly, closing deals. These individuals manage the sales cycle to add, nurture and convert leads into paying customers.
Account managers act as an intermediary between the sales team and the customer. In most cases, when a sales rep qualifies a lead as a potential customer that will most likely make a purchase, they pass on the lead to an account manager that will nurture the lead and help them successfully pass through the sales pipeline to onboarding.
Account managers must maintain mutually beneficial relationships with existing clients to encourage and increase repeat buying.
Sales Development reps work in inside sales and are mostly responsible for managing sales prospecting and lead qualification.
SDRs also help move leads through the sales pipeline but are not responsible for closing deals. Instead, they bring as many leads as they can find and qualify them as disqualified or unqualified for sales.
Once a customer account has been set up, customer service reps now take charge of managing and solving the customer’s complaints, queries and concerns.
For example, if there was an issue with the product delivered or its been damaged or needs to clarify the purchase process, they have to go through the customer service rep first before transferring it to the appropriate sales rep. Essentially, customer service reps also serve as an intermediary between the customer and the company.
A sales team structure is the organization of a sales team. It identifies the goals and responsibilities of every member of the sales team.
For better understanding, we could see a sales team structure as the division of a sales team into different groups, each with its functions. Here are the seven popular types of sales team structures that you can use for your company.
The assembly line model organizes the sales team according to every individual’s job title. This model divides and conquers an organization’s sales process using a linear structure and specific methodology.
Just like an assembly line, leads are split across different specialized teams. In essence, every phase of the sales cycle under this model has a specific job connected with it and every job is handled by a group of experts. The goal of the assembly line model is to move prospects through the different stages of the sales cycle. The categories of these tasks are shared among the following sales professionals:
Pros of Assembly Line Mode
Cons of Assembly Line Mode
The island model tasks a sales representative with the responsibility of managing their prospect from the lead generation stage and nurturing them until they become a customer.
Sales reps under this model are their bosses in the team and take charge of generating, qualifying, nurturing, and closing all of their leads. These sales reps are in charge of handling their sales process. Sales reps under this kind of model tend to be competitive and are usually up against a greater market and their colleagues.
The island model is mostly used by smaller sales teams to increase their output. Sales teams who also benefit through one on one customer interaction could also adopt this sales structure. Most financial services and real estate are the ones that adopt this team structure.
The pod model is a combination of the assembly line and island model. A pod consists of specialized sales representatives who handle and manage prospects through various stages of the sales cycle.
Like the assembly line model, sales representatives in the pod model are assigned different roles to fulfill however instead of being sent to a team that performs only one specific task, these professionals are assigned to a focused group or a pod with different team members performing different roles.
Sales managers in the pod model put one or two sales professionals with each specialized role to create a group of people that have the right skills and expertise to complete the sales process within their little pod. Sales professionals in this pod compete as groups against other groups as against individuals in the island model. The pod model is most appropriate for large business organizations to divide the sales team into smaller groups.
This sales team structure allows sales representatives to become familiar with their geographical surroundings and develop a rapport with local businesses and conduct research on their competitors.
Due to the organizational design of the team, the sales team members can get to know their local area better to improve their relationships. Using this sales model makes it easy to evaluate sales reps’ performance and potential based on a specific location.
In this sales team structure, sales teams are organized or grouped based on the services and products they sell. It enables sales reps to connect with people who are interested in the same product or service as well as those who are located in the same geographical location.
This sales model encourages sales teams to become specialized in their products, master the sales process, and ultimately increase revenue.
This is a popular sales team structure that works well with account-based marketing (ABM). Usually, companies with strong ABM team structures focus more on the customers and accounts, allowing the sales teams to master the ins and outs of working with a specific customer or account.
Doing this puts the sales representatives in a much better position to meet the specific needs of the client.
Under this model, sales teams are structured or grouped by industry or vertical. Sales teams with more specialty in a particular industry usually have more experience and understand the in and out of the industry enabling them to close more deals.
Essentially, if your organization handles sales across multiple industries or markets, you should consider segmenting or breaking the team by vertical.
Here are the factors to consider when creating a structure for your sales organization
Budget is an important factor to consider when structuring your sales team. Although a budget is not the most important factor to consider, it can significantly impact the type of sales structure that will most likely work best for your organization.
For example, if your company budget can only serve one or two sales pods, then you know that a pod model won’t work. Similarly, if you have a small organization, then you know that the island model works best for you. In the same way, if your customer has a low budget, then they should be managed by the same rep compared with customers with higher budgets.
There has been an age-long misconception that sales are more concerned with profitability and increasing market share than fulfilling the goals of the customers.
With this in mind, you must ensure that your sales team chooses a structure that helps you focus on customer intimacy and retention. Depending on your organization, you could choose between the Island model or the Pod model to improve the relationships between sales reps and customers.
Lastly, the final factor to consider is your organizational culture. Ensure that the sales team structure you choose best fits your company’s culture.
Here are some practical tips to build stronger sales teams.
Sales team structures are critical to the successful operations and performance of the sales team. As something so important, you need to consider your team size, budget, company goals, and capabilities of your sales representatives to choose the sales structure that best fits your company and could help your team perform better.
We have identified the seven popular types of sales team structure with their pros and cons as well as the factors to consider and the practical tips for creating successful sales team structures, take a close look at this information to help your sales team perform better.
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