Why You Need a Chief Sales Officer

Is yours a sales-driven organization? When asked this question, most CEOs answer yes. When asked if they have a Chief Sales Officer—CSO—almost all of them admit that they do not. To answer the CSO question for yourself, look at your organizational chart. Is there a representative of the sales department at the C-level? On par with the CFO, COO and others at that level, the sales team deserves to be involved at the strategic level where decisions about the future are being made. While some organizations have found the CSO position to be a critical role, most companies still do not have a CSO. Here are the most common reasons.

• We never had one before. Other C-level positions, such as Chief Technology Officer (CTO), did not exist in the past but the rapid and rampant changes in technology necessitated including the impact of technological innovations in decision making.
• Salespeople are required to achieve the corporate objectives. “We decide; you implement.” In too many companies the salespeople are considered to be different in the way they are compensated, but similar in that they are to achieve top-down driven objectives regardless of what customers want.
• There is no training for the CSO. Libraries are being built now to give the CSO the information they need to execute their responsibilities.
• There are no tools for measuring the effectiveness of the CSO. In fact, Extreme Sales Analytics (ESA) and Sales Resource Planner (SRP) software programs, similar to ERPs, are emerging. ROI, TCO and other calculators are giving way to sophisticated dashboards which are morphing into sales analytic cockpits (multiple, integrated dashboards).
• Your customers do not want a Chief Sales Officer, so why should you bother hiring one? You need a CSO in order for your customer relationships to grow. Customer relationships are dynamic, not static. Either you will drive the changes in the relationship or someone else will: your customer or your competitor. After all, if your competitor has a strategic-focused CSO and you do not, are they more likely to introduce the next new thing to your customers?

Is it enough to have a vice president of sales? Why clutter the C-suite and add to the leadership budget with yet another position? The title is not as important as the function. C-levels are strategists; vice presidents are tactical. The difference between how the time and talents are deployed at the two levels can vary greatly.

• The C-level plans for the long-term future; the vice president thinks in shorter time frames. For instance, if the CEO, the corporate visionary, is thinking three years out (as most are), the C-levels reporting to the CEO need to be thinking two years out. In that scenario, the VP level needs to be thinking one year out, the sales management team thinking one quarter out and salespeople thinking one month out.
• The C-level invests time in learning and evaluating how new processes and technologies will impact business. VPs focus their time and talents on what current capabilities are viable for making more immediate improvements in sales activities and management.
• C-levels are rarely involved in the day-to-day activities while the VP is occasionally brought in to address pressing customer and market issues. The vice president of sales is likely to know the details of significant pending sales while the CSO is uninvolved with them.

Relationship selling is a redundant term—all selling is relationship selling. Companies don’t do business with companies; people do business with people. An example of this occurred when a CSO found a new tablet-based technology that reduced a portion of their sales cycle from three weeks to three minutes. Think about that—three weeks to three minutes. So, 40 percent of their sales were in disaster recovery. When they approached a prospect that had lost, say, 20 percent of their capacity and offered to have them up and running again three weeks earlier than any other vendor, who did the prospect choose? Did the prospect make the buying decision based on price? Of course not. In just more than a year many competitors went out of business because of this new capability. Why was a CSO needed to make this decision?

• The VP of sales did not have the time to thoroughly investigate the new technology.
• A six-figure investment would be required—a decision that would have gone to the C-level anyway.
• Agreements needed to be negotiated with the software vendor for market exclusivity.
• These activities were time-consuming and the VP could not have managed this quickly enough, if at all.

How does the typical CSO spend a workday?

• Evaluating new processes including Lean/Kaizen/Six Sigma for sales and discussing them with the other C-levels, beginning with the COO
• Evaluating new technologies for planning and executing sales activities and discussing them with the other C-levels, beginning with the CTO
• Evaluating the applicability of new compensation concepts and discussing them with the other C-levels, beginning with the CFO

Why not just simply change the title of the VP of sales to CSO? Whether you have a CSO or not, you have the CSO function in your organization. Just as you have the CFO function in your organization even if you do not have a full-time CFO. If you choose to elevate your VP to the CSO position, be prepared to backfill the VP position; both are important. So, what are the criteria the CEO needs to consider when bringing a CSO onboard?

• Hire for tomorrow, not today. Find someone who is comfortable with the changes that are happening in your market, industry, technology and management processes.
• Look for a strategic mind-set. Rather than someone who knows how to get things done, look for someone who can determine alternatives for moving the organization forward.
• CSOs think about “who else?” and “what else?” Look for a creative thinker who knows how to find and solicit new ideas.

The role of the Chief Sales Officer is here. Someone in your organization is filling that role. Are they doing it intentionally or by default?