The most successful tech companies are typically led by their technical, product-oriented founder-CEOs who have very little experience in building a sales organization. Bringing on a sales leader and building a sales organization exercises a completely different muscle for most engineering-heavy startups.
And if you’ve hired right, managing a vice president of sales is meant to be tough work. That’s because the very best sales leaders are extremely demanding. They call out competitive weaknesses, constantly push for more feature velocity, and promise bug fixes or features that get crammed into every release. They stretch everyone to their limit. It will drive you and others in the company bananas.
But if your VP of sales is not periodically at odds with the VPs of product, engineering, operations, finance, etc., then he or she is probably not demanding enough. If done right, this role gives the entire company a reason to work harder as the sales VP reveals and strongly advocates for the customer struggle. That said, the CEO still needs to manage this person tightly. Because once the VP of sales unleashes her or his superpower — being a master negotiator/influencer — inside the company, it can create dysfunction across the team.
As it is it’s not easy for technical founders or engineering-centric startups to take on business management too. So how can they manage a difficult VP of sales?
When I was a CEO, I actually had not one but two high-powered VPs of sales, one for North America and the other for international. I’m not sure I’d recommend this configuration as it was atypical (both were both amazing so I wasn’t going to risk putting one under the other) and takes extra work. But one of the benefits of having two VP of sales at once was that I got a crash course in sales management. Here are some of the things we did that worked out well…
Embrace the conflict
As mentioned earlier, really great VPs of sales usually create organizational conflict. One of the important roles of the CEO, therefore, is to arbitrate those disagreements. But not begrudgingly. He or she has to be both available and even eager to help make the tough “51%-49%” calls: Should we jam in a “super important” customer-specific feature into the next release? Do we price a “sticky” new feature for broad adoption, or to maximize revenue?
These decisions — which involve overruling a very senior, intelligent, passionate member of the leadership team — are often ugly to manage. The CEO needs to carefully listen to everyone’s perspective and make a swift and fair judgment. In addition to making those decisions, it helps to be transparent with your reasoning. One of the things I did was paraphrase both sides of the arguments in my own words. This not only made it clear to everyone that their point of view was carefully considered, but my rationale revealed to them what I valued too.
Set goals that align the sales VP to the entire company — not just to the sales organization
Each sales VP agreed with me on three annual and three quarterly goals. One was usually about exceeding the topline number, and the other two were goals like “hire a Canadian country manager” and “secure five reference customers in financial services”.
By capturing both quantitative and qualitative goals (something that’s often overlooked when it comes to sales, especially in a fast-growing startup), the CEO helps set the tone for what’s important for the entire company — not just the sales organization. These frequent goal-setting negotiations also gave me the opportunity to push and probe on how my team could accomplish more with less.
Meet with them frequently, but don’t micromanage them
To help keep these goals on track, it helps to do frequent 1:1s. It’s also another mechanism, built into your calendar, for making sure the CEO is always available to resolve conflicts.
In my case, we held 1:1s about every two weeks; we’d sit down for 30 minutes or an hour and go over progress towards goals, recent decisions, and roadblocks. I’d have to mentally gear up for those sparring matches with my VPs of sales as it was a rare meeting when they didn’t come in to agitate for more resources, responsibility, or compensation for their teams. I often used these meetings to reinforce the “win/loss” decisions or to get them to empathize with their peers’ perspectives. Investing in this time up front also heads off conflicts and saves time later.
Don’t overlook or dismiss the value of performance reviews
The most pertinent feedback for the sales leaders usually came from the 360-degree comments I would collect from their peers on the management team as part of well-prepared semi-annual performance reviews. Most of the performance review discussions invariably focused on how to work more effectively with their peers since they were already hitting their numbers.
It’s one thing to tell someone they’re being “passive-aggressive”, but it’s way more impactful to hear it explained seven different ways by their peers… And remember, if the CEO doesn’t take performance reviews seriously, nobody else will.
Get out in the field more
It’s hard for a CEO to understand the selling environment, quality of the field teams, shortcomings in the product, or idiosyncrasies of particular customers or places without making frequent trips out of the office.
My rule of thumb was that at least 25% of my time should be spent with our customers and sales teams. Hearing the feedback directly from customers, watching them in front of those customers, riding in the car with the team and taking them to dinner gave me great insight into my VPs’ hiring, training, and the culture they were building in the field. It also gave me great product insight (that I then shared with the rest of the company through a “notes from the road” email on my flight back).
Give them enough room to independently operate
Our international team was set up with an innovative P&L structure that helped us to hire and groom far-flung regional managers to act like owners — with all the responsibilities. Essentially, they got paid commission after we subtracted their region-specific expenses like travel, office space, field marketing, and local team overhead. (We also stopped getting requests for fancy space “we need it for credibility with customers” when commission was taken out after those expenses; they got creative saving on travel as a result.)
Giving sales leaders a budget with an operating envelope to trade off resources will dramatically speed up decision-making, especially when you are managing across time zones. However, it’s also important to realize that independent decision making in operations doesn’t mean a complete lack of oversight.
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Sales is process-heavy, repetitive, and very culturally different than engineering.
While hiring the right person is critical, it is only the beginning of a complex process of integrating them into the team and acclimating them to the company culture. This process must be owned and led by the CEO who must come up to speed on sales management quickly and find ways to blend and appreciate the cultural differences. The amount of time and effort spent here often determines the success or whether the body rejects the organ…or incorporates it into being the superpower it ought to be.
This article originally appeared in Forbes.
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