Salesforce will "exit" underperformers

Published: Wed, 03/01/23

March 1, 2023

TOGETHER WITH

We want to interview you! Yes, you (maybe). We’re interested in profiling sales reps across industries, showing what it’s like to be a seller (or sales manager) in this day and age. If you’re interested in being interviewed and featured in this newsletter, just fill out this quick form, and if we think it’s a fit, we’ll get in touch! We’ll need a photo too, so if you’re camera shy, it’s probably not gonna work. Now, back to our regularly scheduled programming.

NUMBER OF THE WEEK

80% of new leads never transfer into sales.

Source: Invesp

SALES ROUNDUP

Here’s what’s happening in the sales world this week:

Publishing giant Hearst, which owns magazines such as Cosmopolitan and Esquire, will be restructuring its sales organization, centering categories over publishers, according to a report in Adweek. The move comes amid a drop in advertising revenue across publishers and platforms, and is aimed at helping advertisers better target customers. You can read the report here.
A new show about salespeople just premiered on AppleTV. Hello Tomorrow, starring Billy Crudup, is a 10-episode dramedy set in a retro future world that revolves around a group of traveling sales associates determined to revitalize their customers' lives by selling timeshares — on the moon. While it might be a bit out there, any show about sales is likely to draw in at least some of us, right? You can read more about it here.

FEATURE

Sundry Photography/shutterstock.com

Salesforce is reportedly nixing their stack ranking plan, and will instead “exit” underperformers and force employees back into the office

According to an internal Slack message viewed by Business Insider, Salesforce’s annual strategic plan was recently revised by CEO Marc Benioff. Among the changes are eliminating the 5% minimum for stack ranking – that is, cutting the bottom 5% of underperformers in the company annually – and reinstating return-to-office mandates. But the “softening” of the company’s new stack ranking policy doesn’t have many Salesforce employees convinced.

In a note to Salesforce employees posted on an internal Slack channel, Benioff wrote that rather than stack ranking with an eye to cut the bottom 5%, "Managers rate their employees, reward top performers, and exit under-performers to ensure our prosperous new future," according to a copy of the message viewed by Insider. Benioff also wrote in the message that the concept of "ranking" will be removed from performance evaluation going forward.

Some employees feel skeptical that the change in language will actually shift managers away from labeling people as underperformers in performance evaluations.

"He's still pushing performance culture," one Salesforce employee told Insider. "Just by removing that 5% target doesn't mean he won't still do it. He'll just look for a different management method."

Return to the office mandate

Salesforce is also mandating a return to the office for at least three days a week for non-remote employees. For “customer-facing” employees, it’s four days a week. Not long ago, Benioff was disparaging other companies for forcing employees back to the office, but pressure from new activist investors has meant doubling down on productivity and margin growth in recent months. (On Investor’s Day last year, the company announced it would increase its operating margin to 25% by FY 2026). Salesforce’s activist investors are also pressuring the company to increase its stock price, which has dropped to nearly half its value at the height of the pandemic.

Perhaps related to its operating margin goals, Salesforce has asked Bain (Bain, not Bane) to help it implement a restructuring that will "drive solid operating margin improvements and sustainable growth," according to the revised annual plan. This could indicate that more layoffs are ahead, as some Salesforce insiders already suspect.

Given all the recent events at Salesforce, it seems ironic that Marc Benioff would make reference to the company’s "Ohana" culture in his recent Slack message, saying that it would factor into performance evaluations in future. “Ohana” is the Hawaiian word for family and refers to treating those in your community who are not necessarily blood relatives as such.

"Can execs commit to never referring to Salesforce employees as 'family' again?” one employee wrote in a Salesforce Slack channel.

“You don't fire family to compensate for your own mistakes," another wrote.

YOUR CRM IS LYING TO YOU

Imagine that the executive team at your company asks you for a report on why your win rates have been decreasing.

Is it the economy? Poorly qualified leads? Is the sales team dropping the ball?

So you spend your entire morning pulling reports from your CRM to find some answers—only to realize that most of the data for this year’s deals is either incomplete, inaccurate, or insufficient.

You start to sweat.

Are you really going to provide them with a list of general, not remotely impactful reasons like pricing, timing, or—even worse—lost to competitor?

Sadly, this is the reality for too many companies.

Clozd has analyzed thousands of buyer interviews, and we've found that, when compared with actual buyer feedback, CRM data identifying the reason a deal was lost is wrong 85% of the time! Most sellers are missing vital insights into why they're actually losing deals.

Click here to see four more ways your CRM is letting you down—and how Clozd can help you access the accurate buyer data you need to develop a strategy that wins.

MEME OF THE WEEK

Source: Sales Humor – Instagram

QUIZ

On average, how much do the bottom 10% of sales reps make (across industries) per year?

A. $33,000
B. $14,000
C. $26,000
D. $48,000

SALES FAILS

Each week, we bring you the most cringe-worthy sales moments from across the web. To submit your sales fail story for consideration, click here. (Don't worry, you'll remain completely anonymous).

When I was in my 20s, I worked for a cell phone company. Before people got their cell phones directly from carriers, there were a lot of middleman type companies. Our company had lots of locations, but we mostly worked at kiosks inside malls. The money was okay, but I was young and at the time, it was a pretty good job.

I had a manager who I really liked. He was honest, laid back, and a pretty cool guy to hang out with outside of work. But apparently, upper management was under a lot of pressure to make their numbers, and they started coming down hard on all the managers below them. This was during the Great Recession, so things were tough, and we were definitely feeling it.

After a few months of management getting on everybody, they announced that they were replacing our manager (the one I liked) with a sales rep from another location. The sales rep had high numbers, but people who worked with him said that he constantly lied to customers about what they were getting, and was basically succeeding because he was so dishonest.

Well, management promoted this guy, but instead of firing the manager I liked, they demoted him to sales rep. And when the new manager took over, he called a team meeting that we held in the middle of the day at our mall kiosk. The new manager was there, as well as the old manager, who had just been demoted to sales rep and wasn’t happy about it.

The new manager started out by giving us a speech talking about how things are tough but we can pull through etc. It wasn’t bad, it was just a bit corny. But the whole time he was talking, the old manager was mumbling things under his breath, basically calling this guy a liar and saying “bullshit.” He kept getting louder and louder. I tried to give him a look, like “He can hear you,” but the former manager didn’t seem to care.

Finally, the new manager stopped his speech and said, “Is there something you’d like to say?” And the former manager says, “Yeah, actually there is. You’re a liar and a scumbag and there’s no way I would ever work for somebody like you.” Then he flipped him off and walked away, and shouted “Wooo,” as made his way across the mall. Everybody was stunned. We all looked at each other like, “Did that just happen?” I personally worked one more shift and quit too, so I don’t know what happened to the new manager. But the old manager became a successful high-end restaurant manager and is doing quite well.

Anonymous Location withheld

GRAPH OF THE WEEK

Source: LinkedIn Poll -- February 2023

WORTH A PEEK

A lot of motivational sales speeches are, at best, repetitive, and at worst, fake and corny. However, there are exceptions, like the 2021 Sales Success Summit keynote from our friend, sales trainer Ian Koniak, where he talks about the rollercoaster ride that took him from the #1 AE at Salesforce to rock bottom, then back up again. You can watch the whole thing here.

ASK THE QUOTA

Want to submit a question and be featured in our advice column? Click here. (Don't worry, you'll remain completely anonymous).

Dear Quota Team,

Ok, this might be a completely bizarre question, but I think it’s perfect for your newsletter. I have been in sales for close to twenty years, and in that time have held almost every level of position. I’m currently a sales manager in a niche industry, and do quite well.

My question is about a friend of mine. I’ve known him since high school. Most of us have stayed in touch and talk regularly. My friend got into sales about five years ago after he saw how successful I’d been and how it allowed me to afford a great house and lifestyle.

The problem is that he seems to be terrible at sales but doesn’t seem able to admit it to himself. He has worked for seven companies in the last five years, and there seems to be no end in sight. When I talk about it, he talks about sales as if there’s a light at the end of the tunnel, and as if he is close to getting that “perfect” sales job that he’ll be able to succeed in.

From what I can tell, he barely closes any deals. He is a really nice guy which I think helps him land these jobs, but he’s also kind of mentally disorganized and somewhat unreliable, which I think is a big part of the reason why he fails.

I kind of want to tell him that he should find another career. I want to do this for his own good. We’re all in our forties now and most of us have our lives more or less figured out, but he keeps flailing. Should I have a talk with him where I give him some advice, or should I let him figure things out on his own. It kind of hurts me to see him wasting his time like this. Any advice?

Empathetic in New Jersey

Dear Empathetic,

You’re a good friend and you mean well, but since your friend didn’t come out and ask you for advice, this is a bit of a tricky situation to navigate.

You should start by finding out if he wants your help. Ask him how work is going, then ask how you can help. Tell him you want him to be happy and successful and since you’ve been at it for a lot longer, maybe there are some tips you can give him to help him out.

If the conversation goes in that direction, maybe try approaching it from a 'coaching' perspective, or a way where you both talk about what you're good/bad at in sales. Just make sure you don’t come off as condescending or like a know-it-all, since any advice from that perspective is likely to be ignored.

As far as telling him to try another career, you can only do it casually, in the form of a random suggestion. “Hey, I actually know someone who’s doing really well in _____. It might be something worth checking out.”

Giving unsolicited advice is always difficult, especially among friends. But your heart is in the right place, and you might end up making a difference in your friend’s life. Oh, and one last thing: just because somebody doesn’t take your advice right away doesn’t mean they didn't hear it. Sometimes people push back and argue, then walk away and eventually realize you were right. Good luck to you and your friend!

Quiz Answer: A – $33,000 – You can read the source article here

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Today's email was written by Ken Kupchik, Erica Furgiuele, Steve Rado, and Emily Hill.

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