CREATING A PREDICTABLE REVENUE MACHINE IN A
NOT-SO-PREDICTABLE ECONOMY

BY Vail Dutto  

Noticed a slowdown in the market? Fewer leads? Lagging sales numbers? Concerned investors? Sleepless nights?  
A cooling economy is motivating smart businesses to look for the best ways to generate revenue that is both predictable and sustainable.  The good news is, there are strategies that can keep pipelines full and revenue streams flowing in ANY market.  

The solution is to cover more market with fewer resources through an integrated inside-outside sales force. 

Integrated inside-outside sales force:  The partnering of an inside sales force with your outside field sales force in a tiered territory management strategy.  This approach enables companies to leverage the strengths of both sales channels to maximize efficiency, expand market coverage, lower cost of sale, and increase revenue.  Here, the whole is greater than the sum of its parts.

Consider the following  

•  Even the best field sales representative can only visit 2 or 3 clients a day, so of course, he/she will concentrate on landing the biggest and best opportunities ­ the "A" accounts.

•  Small-to-medium businesses (the "B" and "C" accounts) represent more than 90% of all U.S firms (over 186 thousand firms with more than 100 employees but less than 2,500 employees), and generate over $17 trillion in annual revenue. Additionally, no market segment is growing faster.

This is where the opportunities are for tremendous market share growth.

• An inside sales representative can contact 20 ­ 30 potential customers in a day, responding to their needs in a similar manner as the outside sales person, utilizing technology to expedite the process.
  

• The internet has created an arsenal of powerful online sales tools such as product demo's or site tours.  What once required a face-to-face sales call now is ideally suited to an inside sales representative.

The questions to ask are:  Has your company altered your sales strategies to respond to the changing market conditions?  What is the best way to penetrate deeper into your market, cost-effectively cover the B and C accounts, and lower the overall cost of sale?  Review the following scenarios. These scenarios are based on assumptions of salaries and number of contacts needed to close a sale. Though your numbers may vary, the ratios do not, and the formula remains consistently accurate. 

Example 1:  Field Sales only  
Let's say you currently have a field sales force.  They focus on the largest sales opportunities possible to get the biggest bang for their effort.  Between their travel time and generating complex proposals, rarely do they have time left over to prospect or pay attention to smaller sales opportunities.    

In our example, the outside sales representative averages 2.5 client visits/day (22 active business days in a month) = 55 contacts/month assuming 3 contacts per closed sale and a 10% close rate = 2 sales/month @ $30,000/sale = $60,000 at a personnel cost of $12,000 (20%).    
Example 2:  Inside Sales + Field Sales, working separately  
An insides sales representative, because they can make ten times the sales calls in a given day, covers more territory and focuses on the small-to-medium sales opportunities.   

They average 26 client contacts/day = 572 contacts/month assuming 4 contacts per closed sale and a 10% close rate =  14 sales/month @ $3,000/sale = $42,000 at a personnel cost of $4,500 (11%). 

Total revenue per month for both sales channels equals $102,000 at a personnel cost of $16,500 (16%) An incremental gain for the company at a lower cost of sale.  Not badŠ but not good enough.  

Example 3:  Integrated Inside-Outside Sales Operations  
In this scenario, a well-integrated inside-outside sales team generates more revenue than the sum of its individual parts.  The inside sales representative manages and closes small-to-medium accounts.  In addition, they devote part of their time to qualify leads for the large, complex sales opportunities which they pass to the field sales representative.  This shortens the sales cycle and yields a 2-fold increase in the sales productivity of the outside representative working on his own.  The inside representative also follows up existing accounts to pursue additional revenue. 

The Integrated Inside-Outside Sales Multiplier:

 If y = inside sales representative productivity;  and x = outside sales representative productivity 

1/2y + 2x = total productivity

.5 x $42,000/month + 2 x $60,000/month = $141,000 at a cost of $16,500 (11.7%)   
A 39% increase in revenue potential, and a 41% decrease in the cost to acquire the sale compared to an outside sales effort alone. 

WHO'S ON FIRST
For an inside-outside sales strategy to work, there must be a clear territory coverage strategy with defined roles and responsibilities.  The following matrix outlines who has the ball at each step of the sales cycle for an A, B, or C revenue opportunity: 

Inside-Outside Sales
Territory Coverage 

A = Top 10% largest accounts B = Middle 60% accounts C = Bottom 30% small accounts

CRITICAL SUCCESS FACTORS

In order for inside-outside sales integration to really work, the two teams must co-exist, including:

• Common Quotas and Compensation

• Common contact management systems  

• Common language  

• Key performance indicators  

• Weekly territory strategy meetings  

• Production reports

Create a formalized territory management plan and then make sure everyone on your entire sales force understands, buys in and knows how to use it.

BUILDING THE REVENUE MACHINE
An integrated inside sales operation can be a measurable, predictable, profitable revenue machine.  But it does require introducing change and a unique set of management processes that are more detailed then the traditional field sales approach. 

Here is an overview of the methodology that has proven successful.  They break down into three components:

PROCESS AND INFRASTRUCTURE
This is where market opportunity is analyzed, revenue and expense forecasted, process flows, call guides, and reference tools are standardized, metrics are set, performance technology is installed, inside sales managers and representatives are hired using call center-specific recruiting process for sourcing, screening and testing.

This infrastructure will be critical to providing your sales force with the tools they need to maximize your revenue.

PIPELINE MANAGEMENT
Pipeline management simply means a process by which leads are managed from start to close and revenue is forecasted based on the stage of that lead in the cycle. This is broken down into two categories: Goals and Methodology. 

The goal-setting stage is where the buying/selling cycle is dissected, conversion metrics determined, and revenue forecasting models are designed.

Once you've identified your goals, the methodology of filling and managing the sales pipeline begins.  There are seven main stages in this methodology -- "P-stages". Understanding what to do at each stage is key to keeping the pipeline growing.  

P1: AWARENESS/RAW LEAD ­ find the list sources and business models which best fit your profile buyer
P2: PROSPECTING & QUALIFICATION ­ identify the decision maker, need, desire, budget and timeframe, and get an appointment.  
P3: EDUCATE ­  conduct a meeting or conference call to present, validate need, review cost, define scope and timeline.  
P4: PROPOSE ­ document the scope, pricing, delivery, etc.  
P5: VERBAL AGREEMENT ­ 
P6: PO SENT ­ 
P7: PRODUCT OR SERVICE OR DELIVERED ­ 

PERFORMANCE DEVELOPMENT
You've got your infrastructure, you've defined your sales plan and goals, you've hired the right people, and you've given them the tools and methodology to operate at max- capacity.  Now comes the often-overlooked component of your sales machine that accelerates revenue output:  training and skills development. 

Particularly when introducing a new sales methodology, it is imperative that representatives, both inside and outside, receive the training and reinforcement to equip them for success.  Basic training on product features and benefits is not enough. 

A solid skills training curriculum should include courses on communications, qualifying, probing, overcoming objections, presenting solutions, closing, and pipeline management.  Skill levels should be certified, and ongoing development plans created for each sales representative. 

Performance Development also includes utilizing Key Performance Indicators (KPI) so both the manager and the representatives can measure their success.  Unproductive representatives are either developed or moved out. Representatives to work together productively and are rewarded for it.

THE BOTTOM LINE
Developing an integrated and streamlined methodology for maximizing sales is just good business. But it can also be a complex and cumbersome process to initiate if you're not an expert.

According to a recent study by DGY Associates, companies that outsource their call center function have a higher 10-year average return on investment, and a higher 10-year average growth rate and earnings per share.

A case for outsourcing? Certainly. But not in the traditional sense.

Generally speaking, the cost for InTelegy to develop and maintain this kind of call center operation is less than in-house or off-site outsourced options because of quick ramp times, available resource pools, and economy of scale operations.

In today's challenging market conditions, speed and cost-efficiency are paramount to more immediate lead generation, and  a healthy bottom line overall.

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Vail is the co-founder and chief executive officer of InTelegy, a Call Center Management Company that designs and manages inside sales and customer support call centers for a variety of clients and industries. Those call centers built by InTelegy typically integrate phone, email, and/or online chat customer contact.

Voted Entrepreneur of the Year by the San Jose Business Journal for 200l, Vail has turned InTelegy into one of the fastest growing private companies in Northern California. It is her vision to turn customer contact centers into revenue "machines" that manage customer relationships and create real competitive advantage.

Vail is a frequent speaker on customer acquisition and retention strategies for small to mid-sized businesses. She is a graduate of the University of California at Berkeley with a degree in  International Business.

SIDEBAR

HOW HEALTHY IS YOUR SALES ENGINE?
If you already have an inside sales operation, use this self-test to see how you measure up to the industry standard.

Inside Sales Operations Checklist
Do you know the numbers? 

• Conversion rates for inquiries into qualified leads and leads into sales
• Average revenue per sale
• Average contacts per hour  
• Average sales per hour  
• Average cost of sale  
• How to accurately forecast revenues based on the current pipeline

Is your process well-defined?  

• Your sales representatives understand the steps from lead to closed sale  
• Your sales representatives know what to do at each step to move a sale forward
• Your sales representatives fill and manage their sales pipeline to consistently hit goal
• Your sales representatives have documented call flows and support reference tools

Do you develop and manage your sales representatives?  

• Your training includes sales skills such as qualifying, presenting, overcoming objections, closing, and pipeline management  
• You have a team manager dedicated to monitoring, coaching, and development  
• You manage to performance goals such as number of contacts, pipeline development, and average order size  

How did you do? If you were able to check all of the boxes, congratulations! If not, there is room for improvement which should also increase sales.

Company Overview

Who We Are - What We Do
Founded in 1996, InTelegy is a Call Center Management Company specializing in the distinct disciplines of inside sales and customer support. We provide comprehensive design and implementation services which include planning, consulting, and on-site operations management for companies that need to build a new customer service or inside sales operation- or fix an existing one.

InTelegy designs, staffs and runs inside sales and customer support centers for companies ranging in size from 10 to 100 seats. We have extensive experience working with new economy companies, dot-com's, and businesses that need to create more profitable customer relationships and incremental revenue

The InTelegy Difference
A contact center is a complex and difficult operation that few companies know how to do well. It typically integrates phone, email, and online chat customer contact and requires very specific expertise to manage the critical components of process engineering, personnel management, and technology automation necessary for success. InTelegy delivers that expertise backed by a breadth of resources difficult for most companies to duplicate in house.

InTelegy utilizes a turnkey "onsite outsourcing" model that is designed to meet your specific business requirements and budget. We partner with our clients to implement the contact center in your facility. This includes every facet of the operation, from operational design and process flows, through selecting the technology and staffing. Then we manage the day-to-day front line quality, productivity, and results.

In essence, InTelegy creates a well-tuned customer service or inside sales "machine" run with hands-on personal attention

We create real competitive advantage for our clients and this has made InTelegy one of the fastest growing private companies in northern California according to the San Francisco Business Times.

Inside Sales

InTelegent Inside Sales: Measurable, Predictable, Profitable
Your inside sales (or telesales) operation should be a revenue machine built around carefully managed processes, manned by well-trained professionals, and supported by smart technology. 

Pipeline management
Sales increase through focus on filling the sales pipeline and moving customers through it in an integrated approach with marketing, field sales and other channels

• Dissect each stage of the buying/selling cycle to better manage every client contact
• Fill the pipeline with qualified leads
• Understand conversion metrics and time pipeline growth to ensure hitting goals
• Prioritize contacts to better move prospects through the sales cycle
• Analyze and forecast revenue
• Identify long-term opportunities to optimize the revenue potential of every account

Performance development
Through comprehensive training at all operational levels, ongoing skills development and objective measurement of performance, InTelegy further accelerates results

• Implement representative training through classroom-based new hire curriculum and our ongoing Representative Development Series (RDS)
• Certify representative skill levels in turnover situations with InTelegy's self-managed TASK training curriculum
• Elevate management skills through our Supervisor Development Series (SDS) and Management Learning Forums (MLF)
• Manage to key performance indicators (KPI) and conduct Totem tracking to identify, develop or replace unproductive representatives

It is our goal at InTelegy to forge a hands-on partnership with our clients to drive revenue to the bottom line. InTelegy can implement a new inside sales operation or turn around an existing center in as little as 8 weeks. For more details or to schedule a free assessment, you are invited to call or email us at info@InTelegy.com today.

Think of all the processes, tools, and curriculum that you don't have to create, test, and implement! To review examples of InTelegy Operations Management methodologies, contact your InTelegy sales executive or email us today at info@InTelegy.com.

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