Tl;dr - A great VP of Industrial Sales must be a rare combination of a superb business leader, effective sales manager, and great salesperson. Finding that rare individual requires a clear definition of the role as it should be performed - not necessarily traditionally filled - and predictive candidate assessments.
Hiring a VP of Sales is Like Unicorn Hunting
A great VP of Sales for an industrial manufacturing firm must possess an almost unrealistic set of skills and attributes.
(S)he must be a great executive; a great sales manager; and a great salesperson.
It's hard to find someone who's great at any one of those, much less all three. It's a genuinely tough sales recruiting challenge.
That means most companies compromise.
Often the compromise is unintentional. The job is often poorly defined because the business processes and attributes of great executives, sales managers and salespeople are themselves quite vague. And then the hiring process is run on largely qualitative criteria (gut feeling) which is benchmarked against vague requirements - introducing compound errors. There's no way that a resume (21% predictive of success), a couple unstructured interviews (mostly for personality and culture), and a couple references will reveal who has the skills, grit and vision to succeed as a VP of Sales.
In other cases the compromise is intentional, albeit well-meaning. A long-time loyal employee with acceptable sales performance (in previous eras of selling) is rewarded with a position. They may well be hard working, honest and sincere. But they're not, can't, and will never be a great VP of Sales.
Absent clearly defined expectations and processes, the person currently in the role becomes the benchmark against which others are compared. That makes it really hard for a company to ever hire a superb sales leader.
The key is to interrupt that cycle to implement a robust sales hiring process. Here's how you do that.
Sales Rep, Sales Manager, Sales Leader - What's the Difference?
Salesperson, Sales Manager and Sales Leader are very different roles. Let's look at each quickly and define the terms.
A salesperson has to close deals. They work directly with buyers, and in some cases with OEMs, EDCs (engineering, design, construction firms), and with indirect sales channel (distributors and agents.) They carry quota, and are responsible for prospecting, pipeline and revenue.
A sales manager is responsible for the performance of a group of salespeople. The span of control (how many reps a sales manager can effectively handle) will depend on whether the manager also has their own sales production targets. Assuming it's a pure sales management role, they can reasonably handle 4-6 reps. (This article explores the difference between hiring a sales rep and a sales manager.)
A sales leader manages several sales managers. In lower middle market companies this role is often called VP of Sales, and they are likely a member of the executive management team, and all revenue responsibility rolls up to them.
These job functions and responsibilities are different than job titles which have followed the banking industry in title inflation. Many sales reps have "sales manager" job titles. Many sales managers have "VP of Sales" job titles. And many sales leaders have titles including "VP of Sales & Marketing", "CRO" (chief revenue officer), and Sr. VP or EVP.
To improve sales we need to understand the roles and responsibilities and focus on those. Hiring a VP of Sales, regardless of what you label it on the org chart, requires a clear understanding of the role. But be aware that misleading titles on job postings can result in mismatched candidate skills and expectations.
Defining Organizational Roles & Expectations
Prior to hiring a VP of Sales you need to be clear what you expect them to do. Of course during the 5 or more years you expect them to be with the company, responsibilities will evolve. But hiring the right person requires defining what they should be able to do.
Obviously, the sales leader will manage several sales managers. If you don't have at least two sales managers, you might not need a VP of Sales.
But your sales leader will need to do more. For example:
- effectively lead and manage sales managers
- brief the board on market conditions, competitive changes, sales trends and forecasts
- talent management - developed sales managers to become sales leaders, create culture and structure to help sales managers develop sales reps to become managers, make all hiring/firing decisions, create structure for recruiting program, reinforce corporate culture within the sales team
- strategy - identify market opportunities and explore product line extensions, acquisitions, partnerships, new geographical and/or vertical markets
- represent the company in trade associations and industry groups
- speak at large public events
- advocate on behalf of the firm and industry in local, regional, and perhaps national policy and regulatory forums
- function as a contributing member of the executive management team, advocate for the sales team and make suggestions of organizational changes (e.g. if quoting is a bottleneck in engineering, migrate it to sales)
- embrace full accountability for the company's revenue performance (or lack thereof)
- represent the company to investors, commercial lenders, strategic partners and potential acquirers
- develop sales forecasts and carry budget responsibility for the sales function
- ownership of all sales process, channel decisions, sales methodology, and sales training decisions and investments - continuous improvements in productivity, efficiency, effectiveness and results
- intense collaboration with marketing since these are integrated functions today
- present the sales team's perspective, goals, and priorities to all stakeholders
You may add others to the list. If your first reaction is that some of these are well beyond your vision for a VP of Sales, then you're probably:
- actually looking for a sales manager
- improperly limiting the scope and contributions that a strong VP could make
In any event, the VP of Sales will have a large impact on the company beyond simple revenue performance and sales team management.
Your process for hiring a VP of Sales must contemplate all of this.
Properly Defining Sales Roles
Embedded in the organizational responsibilities are some more specific sales details. But there's still a lot of grey area.
So you need to fully define sales roles too. That means job descriptions for each level of sales, with defined expectations and KPIs.
What percentage of time will your reps spend prospecting, managing deals, and performing admin tasks? How will your managers prioritize coaching vs. reporting vs. recruiting? And how will your VP balance corporate leadership with sales-specific responsibilities, or 5-year strategic goals vs. quarterly results?
Assess Candidates Against These Criteria
With these criteria established you now have a baseline to assess candidates. Your job posting (different than a job description) for a VP of Sales should capture the essence of these.
You'll have a blend of qualitative and quantitative attributes and skills, and you'll need some predictive, empirical tools/measures to help guide your selection process. It's easy to let comfort with folks to whom you feel some personality connection override the business imperatives.
This is the purpose of a sales leader candidate assessment. An objective, predictive, data-based tool to identify who has the skills and aptitudes to succeed and not just make you comfortable with them.
Sales assessment tools for sales leadership candidates will screen for a number of attributes. These include:
- Will to lead the sales organization (commitment, desire, outlook & responsibility)
- Leadership competencies
- sales leadership
- strategic thinker
- develops strong relationships
- Management style tendencies for:
- strategic thinking
- relationship building
- Sales leadership DNA
- need for approval
- stays in the moment
- supportive beliefs
- supportive buy cycle
- Leadership styles and qualities
- crisis resilience
- boardroom presence
- business integrity
- holding others accountable
- pursuit of excellence
- makes difficult business decisions
- open to new ideas
- passion for the business
- work ethic
- team player
Each in turn incorporates approximately 10 measured elements to provide the predictive assessment of how a candidate will perform as a VP of sales.
The assessment tool should be customized for the details of your market and your company's systems and processes.
This sort of assessment tool offers a number of benefits. First, it allows you to screen a multitude of candidates but only invest time in interviewing those who have the required skills and aptitudes. Second, it protects you from unconscious bias (e.g. from names on resumes) and helps you avoid developing a strong connection to a candidate based on a pleasant interview which might distract you from other considerations. Third, it solves for one of the most difficult parts of interviewing - knowing where to concentrate questions to determine the potential fit.
The leadership styles and qualities section can also be used to gauge fit as a member of your executive team, if you build a team profile by having your other managers to take evaluations that are available for all management/board roles (not just sales.)
Unlike personality and behavioral tests which are problematic for pre-employment screening and use an ipsative methodology (comparing one to oneself), you need predictive tools that use normative methodologies (comparing one to others) for accurate results.
Thin Ice - VP of Sales AND Marketing
Here's a caveat for industrial companies that tend to think of marketing as a barely-tolerated younger step-kid to sales. If you add marketing to the title, make sure you're clear about what responsibilities you'll add. Don't have them supervise the trade show coordinator and then call it VP of Marketing.
Having an anemic marketing function report to a sales leader with minimal marketing experience will compromise your results. The two functions are so interrelated today, and buying journeys so convoluted, that you really need equal strength of experience and leadership to optimize your revenue growth function.
Hire the Right Person for the Role You Need to Grow Your Company
Too often companies hire for roles that carry misleading titles. A VP of Sales with three reps directly reporting is actually a sales manager. And a great sales manager who effectively coaches reps may not have any of the executive management skills needed as a true VP.
So it's important to clearly define the role you need to fill.
Then, don't rely on resumes and gut feeling from unstructured interviews (both minimally effective at hiring successful sales talent.) Use a data-based and predictive candidate assessment specifically designed for sales leadership.
If a VP of Sales is what your team needs, then follow this process. On the other hand, if you're looking for a sales manager, then you'll find more here.