Designing sound sales compensation programs always begins with a clear understanding of your company's sales structure and specific sales roles (which presumably have been thoughtfully defined in light of your overall sales strategy, right?). One common, and perhaps potentially overused, sales model is that of the hunter and farmer. In this model, there are sales people in the role of the hunter, whose charge is to find and bring in new customers, and other sales people in the role of the farmer, who are responsible for building and nurturing the customer relationships.
In their recent newsletter as well as their article in the July/August 2008 issue of the Harvard Business Review , Jerome Colletti and Mary Fiss advise against the often leapt-to conclusion that this popular approach is always the right sales staffing solution, and walk us through some of the hunter/farmer sales model's more serious shortcomings:
- It rests on the assumption that the business of selling to new customers is transactional rather than consultative; hence, it is easy to "hand it off"
- It assumes that the skills required for the hunter and farmer business development roles are fundamentally different
- It assumes that there is more business to be had from new than existing customers - not always the case
- It trivializes the cost of the hand off from hunter to farmer
- It disregards that the hunter may leave a fair number of "loose ends" since they don't have to deal with the consequences of on-going customer relationship
A reminder that it is always a smart step to carefully assess your own company's situation and strategy, and select a staffing and compensation approach that truly fits and supports it.
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