Sales Management Tip: The Value of Having a Dynamic Account List Management System

A good system can increase a company’s credibility with its external customers (clients) and internal customers (employees). Without a good system, sales management can look like the keystone cops in the eyes of both customers and employees.

While many companies use various methods of determining which salespeople will call on what accounts, few managers have a solid and well-thought out strategy on how to assign accounts. In many cases its "case-by-case" (as the managers would say). The lack of an organized strategy can only spell trouble in many different ways.

While some sales managers assign accounts by territory or account classification (small or large accounts, or categorized by the client’s industry classifiction), many managers do not divide account assignments up as clearly. Lesser lines of division of "who calls on what account" can be a bigger management challenge.

If accounts are divided up by territory or account classification, are there exceptions to the "rule"? If so, what are those exceptions? Have those exceptions been clearly stated to the sales staff or is it a "case-by-case" situation? The rules of the game should be stated up front, before the game is played.

I would argue the point that the "case by case" situation only puts the manager in the role of "Judge Wapner" which is not good for morale, since most of management’s "case-by-case" decisions will result in accusations of "favoritism" by those on the short end of the decision stick. (How many losers on The People’s Court were ever happy?) Situational decisions are bad for morale and wastes valuable energy and selling time by the sales staff.

If the lines aren’t clearly drawn, and too many exceptions are made to the account assignment rule, then the rule means nothing. Clients could be faced with two or more salespeople calling on him or her. This makes the company’s sales management appear that they have no control over account assignments.

"Why should I do business with this company?" the client may ask. "If they can’t determine who is going to call on me, how in the hell can they help me improve my business if they can’t even manage their own sales structure?"

For companies that use territories to assign accounts (or assign accounts by industry category) the gray area is lessened with the "who calls on what account" question– provided there are no exceptions to the assignment definitions. For businesses that don’t have the luxury of dividing account assignments by clear-cut territories or classifications, the management of account assignments is a little trickier. This is the case in many companies, including most media sales organizations.

Not having a good account list system can cause problems, but let’s examine the worst problem— the morale problem.

While some managers think that "competition is good" within the sales staff, competition for accounts is not a good thing if the rules are unclear. This type of unhealthy competition is destructive. When the account list assignment rules are not clearly spelled out by management, strong-willed salespeople will start prospecting off of each others’account lists. (This is especially true during slow economic conditions!) With an unclear account assignment policy, then Darwin’s theories will be observed on the sales team.

While some managers may find watching this "survivial of the fittest" behavior somewhat entertaining, it is waste of time and efficiency. Not only is the work effort of two or more people (who are working on the same accounts) ridiculous, the resulting moral problems exacerbate call reluctance among the staff. The staff will factionalize and meet outside of the office at various locations around town discussing the unfairness of the situation and criticizing the lack of strong management. And if "Judge Wapner" has to get involved an account decision, that’s even worse. Rest assured that the judge’s decision of which salesperson wins an account dispute will be severely scrutinized by everyone on the sales team more than the Roe v. Wade Supreme Court decision. (Plus, two or more salespeople putting effort toward the same accounts sacrifice valuable work effort on other accounts.)

Management decisions set a precedent. When the decisions are not consistent with previous decisions, the staff becomes very more cynical and despondent. (One of the biggest reasons a salesperson will leave a company is because he or she feels preferential treatment exists. This is an issue of "unfair pay" in their minds since most sales jobs are commission or bonus-based on sales performance.)

I suggest sales management have a written policy. This written account policy should deal with "what is" scenarios in the case that an account switches buyers, ad agencies, purchase agents or if the account merges (or acquires) another existing account. Management should try to eliminate as many gray areas as possible to avoid as many subjective decisions as possible. Subjective decisions will indubitably have to be made in many areas, but the fewer subjective decisions that a sales manager makes which directly affect sales compensation will keep morale higher and consequently keep the staff more focused on their customers.

Managers should give the written policy to all salespeople, letting them know the rules in advance. The written policy would contain the guidelines on how management will assign accounts. As stated before, the rules of the game should be known to all before the game starts. Here are some suggestions if your company doesn’t divide account assignments by clear-cut territories or account categories:

  • Have a form that salespeople can turn in to claim new accounts with a date and time on the form. "First come first serve" is the fairest way to do this. Management signs off on the form and gives it to the the account list administrator (a sales assistant in most cases).
  • I also suggest that management limit the number of accounts each salesperson can have on their account list. In addition to ensuring that existing accounts are getting the right amount of service, a shorter account list has other benefits. A long account list can cause a salesperson to lose focus, prevents other salespeople from calling on accounts that aren’t being actively worked by the salesperson who has an account list the size of the yellow pages.
  • If a salesperson claims a new account– and the newly claimed account puts the salesperson over his or her account limit– then the salesperson must drop another account to stay within the limit. That account could then be claimed by another seller.
  • Accounts that "call-in" (and aren’t on another seller’s account list) should be rotated equally using a written form which is managed by the sales secretary or sales manager. Calls should be distributed on an equal rotation. Salespeople should have the ability to see the call-in sheet to know they are getting their fair share of call-ins within the rotation system. Of course, existing accounts that call in should go to the person who has the account listed (even if the prospective client can not remember the salesperson’s name).
  • A master account list should be published for all sellers to view. This ensures that sellers do not call on another salesperson’s account. Management must let all salespeople know that prospecting off of their co-workers’ lists will not be tolerated. If a salesperson sells an account that is assigned to another salesperson, then the seller who has the account on his or her list should get the credit for the sale. No exceptions. To make an exception sends the message that the policy is a joke, and it also leaves room for manipulation by a crafty salespeople. Although there is some risk in losing the one order in the situation mentioned above, the loss of one order is miniscule in comparison to letting salespeople manipulate your account management system.
  • Master account lists should be updated and printed for everyone’s view every two weeks (at least). When the master account list updates occur, each salesperson should get a copy of his or her updated individual account list as well. This updated list would show all recently added accounts (and dropped accounts) made within the previous update.

Yes, this is a lot of work (especially at the beginning) but it’s critical.

Management must help salespeople focus on their individual profit centers (account lists) rather than internal political issues. Management must help people focus on their customers and the marketplace (which exists outside of the office) and not on issues inside the office. A salesperson should have the knowledge of knowing which accounts to call on, and the security to know that other sellers will not be successful in prospecting off of his or her account list. This is called "setting expectations."

Of course, clients and prospects deserve this respect as well. When a client is put in the middle of an account squabble, it is a disgrace. It merely shows that the manager is incapable of managing.

While these are simple guidelines, very few managers understand the value of this simple process. While it does takes some work on the front-end, a dynamic account list system can maximize revenue, reduce turnover and enhance management’s credibility with employees and clients.

There are more sophisticated ways to use this type of system when it’s up and running– but unless these basic guidelines are in place, all other strategies are a waste of time and energy.

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