Lesson 11: Your Whole Sales Team Doesn't Have To Be Great
Growing an SMB SaaS business is hard. The journey has a tremendous number of peaks and valleys, including times of electric overachievement. I’ve been there multiple times, and the feeling is unlike any other. You’re humming along, and beating revenue targets. It turns out that you’ve had this figured out all along, right?
Then it happens. You start scaling or growing faster, but revenue doesn’t keep up. You start to see signs that things aren’t as well-oiled as before. Things get chaotic. You start to look for answers.
I found my answers in The SaaS Sales Method: Sales as a Science, by Jacco van der Kooij and Fernando Pizarro. it’s one of the most practical and science-driven sales books that I’ve ever read. It was perfect timing.
In the book, they talk about the shift towards improving process, technology, enablement, skills and teams. They argue against the “superstar” culture, where sales revenue is people driven, and people are moved in and out in an attempt to find “superstars” to take you to the promised land. Focus on process improvement is far from new, but the data and science they use to make their points is really fascinating.
One of the more compelling parts of the book takes a look at the shift in SaaS from Pareto’s Law of 80/20 (in this case, 80% of your revenue coming from 20% of your team, or the “superstars”) to a smaller percentage of total revenue coming from that same 20%. It’s especially prevalent in SMB SaaS, where deviation in contract size isn’t very large between top and bottom performers.
Check out the example below. This looks at a team of 20 inside sales representatives with small ACV variation, which is common in SMB SaaS:
In this example, the “superstars” still make up 20% of the team, but their overall revenue contribution has been reduced to 36%, rather than 60% or 80%.
Jacco and Fernando point out the challenge in both hiring and retaining superstars. This reemphasizes the importance of investing more in the foundational aspects of your process, tech, enablement program, skills coaching and teamwork, rather than having a knee-jerk reaction around firing and re-hiring bodies.
The SaaS Sales Method: Sales As A Science is a book I cannot recommend highly enough. Here’s a link to the book on Amazon if you want to check it out, or you can head over to my Reading Lists section to see more books I recommend.
I’m not affiliated or compensated in any way. Happy learning.