The first Sales VP you hire is a critical move for your startup or small business. This hire, when done correctly, can mean acquiring your first customers as well as your next 25 customers.
What’s so great about reaching 25 customers? That’s when it’s time to scale your company and move to the next business tier.
The business landscape is littered with first-hire Sales VPs who were let go after 12 months and hundreds of thousands of dollars in salary and perks. Here are 4 reasons why.
- As the CEO of your startup or small business, you are reluctant to sell. You can’t wait for the available funding so you can run out and hire your first Sales VP. In your mind, selling is someone else’s responsibility, certainly not yours. Reality check: As the CEO of your business entity, you are the company’s first Chief Sales Officer. You are also the Emeritus Chief Sales Officer. If you aren’t willing to continuously represent your company to the marketplace, as its icon and avatar, why should customers buy what you – yourself – are reluctant to sell to them?
- As the CEO of your startup or small business, you don’t adequately articulate your value proposition to your first Sales VP. Just because you hired someone who sells doesn’t mean that they “get” your company. No one really has their heart and soul invested in your business as firmly as you do. You should be wearing your value proposition like a second skin. Articulating your value proposition should be second nature to you by now. If you can’t articulate your vision and goals to the VP of Sales, you won’t have a successful transition of roles.
- As the CEO of your startup or small business, you hired an extremely successful salesperson as your first Sales VP. These types of individuals are just that: terrific sales people with impressive track records working for other people. However, sales organizations will tell you that successful sales people don’t transition well into management let alone leadership. These individuals are used to working alone, according to their own rules and dynamics. As the CEO, you want them to go out and sell, sell, sell. They may be selling: to anyone who will buy instead of your carefully targeted and cultivated marketplace. Compound that with #2: you didn’t adequately articulate your value proposition to this VP of Sales, and you have trouble, my friend.
- As the CEO of your startup or small business, you are not using the right set of metrics to measure sales success. You are so focused on acquiring customers and selling something, that you only are measuring monthly and quarterly incoming revenue. Anything upward is just fine in your book, right? Review #3. Is your VP of Sales selling to anyone who will buy? Are they building a loyal and retained customer base? Are there opportunities for repeat business or will you have to re-acquire new customers annually, to replace the ones who drop out after only one year? There’s no ROI in this strategy.
When one or all of these factors are put into play, you will find yourself back at Square One after 12 months. Be mindful when hiring your first Sales VP. My advice: think hard before you make that kind of leap. Your perception of reward and ROI may be a very risky move.
Babette N. Ten Haken, President of Sales Aerobics for Engineers®, LLC, catalyzes business transition, startup growth, and professional development. She works with non-traditional sellers like engineers, manufacturers, and technical startups to create sustainable business models and revenue strategies. This post first appeared on the salesforce Blog and is adapted and reprinted with this author’s permission.
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