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How the Tactics Used to Grow CEOs Will Boost Your Sales Team

Jan 14, 2010 Red Flag Alert Updated On: October 11, 2023
How the Tactics Used to Grow CEOs Will Boost Your Sales Team

Sales leaders want their teams to perform at a high level. However, it isn’t always easy to know how to develop reps so that they can reach their full potential.

A recent article by the Harvard Business Review could help. The publication detailed the steps a small number of companies are using to produce an unexpectedly high number of successful CEOs.

There are plenty of ways these strategies could also be used to develop sales reps. In this article, we’ll look at some of the techniques these companies are using to build CEOs and see how sales leaders can use them to help improve their teams.

Introduction to the Report

The report says that historically, large organisations like General Electric, IBM, and McKinsey have produced the most CEOs. However, it noted that there are now around a dozen smaller companies that are also successfully producing a disproportionate number of leaders.

The CEOs from these organisations often produce great results. The report found that organisations led by CEOs who came from Rohm and Haas, for example, performed 67% better than when the same company was led by CEOs from other organisations.

The article then goes on to detail some of the methods these organisations use to develop leaders within their business and provide them with the skills and experience they need to be CEOs. The points are as follows:

Give Leaders Broad Authority

The former president of Rohm and Haas explained how the company would put employees in charge of running full profit and loss balance sheets in areas within the organisation very early on in their careers.

Essentially, the managers were running the departments as if they were overseeing a business. They would make decisions with minimal input from higher up, giving them full responsibility for the outcome.

How did this create good CEOs?

This experience meant the employees gained many of the skills needed for CEO positions. By the time they were recruited to manage a business, they already had years of leadership experience and much of the knowledge they would need to be successful.

Sales leaders can use this same tactic to develop the skills of their reps. They could give reps that are performing well more authority to make their own decisions in the sales process – for example, letting them lead negotiations or (if appropriate) giving them more scope over pricing decisions.

By giving them more autonomy, sales leaders expose their reps to more challenging circumstances in the hope that this will accelerate their development.

Encourage Leaders to Think Like CEOs

You don’t want to dump sales reps into the deep end without providing any guidance. The report suggests an alternative to providing top-down instruction.

It says that the businesses that create a high number of CEOs are those that encourage leaders to think like CEOs early on in their careers, by asking them to consider how their decisions will influence business goals or affect stakeholders.

The examples in the report include:

  • Danaher encourages leaders to focus on the metrics associated with value creation – for example, cash and returns on working capital.
  • Rohm and Haas ask leaders to make decisions based on their responsibilities to the five stakeholders, or “voices”, most important to the company. The leaders would consider customers, employees, investors, the community and the process before making any decisions.

From early on in their careers, leaders at these companies make decisions based on how they would affect the business and the stakeholders they are accountable for.

When trying to develop sales reps, you should ensure that your team is focused on the metrics that are most important for results in your business.

In sales this can be a powerful tactic. Many sales teams simply focus on top-line metrics like sales revenue or the number of sales. Instead, consider asking reps to consider lifetime value and sales efficiency ratios and help them understand how sales figures plug into the wider context of the organisation. This extra layer of detail will help reps appreciate their role in the business and improve their decision-making.

Challenge Strong Performers Early On

According to the report, companies that successfully build CEOs are happy to challenge high performers with larger opportunities.

The article gives the example of a young manager at Rohm and Haas who was tasked with launching a $1 billion venture that was larger than any of their existing business units at the time. Despite her lack of experience, the executives at the company felt that she had the ability and skills to succeed. They were right: the young manager successfully launched the venture and went on to become a successful CEO.

The key takeaway here is that while experience is helpful, it isn’t the only factor in success. Giving high-performing sales reps more responsibility and challenges early on in their careers allows them to prove themselves much faster than they would usually be able to.

Culture of Leadership

Ultimately, the article suggests that to develop leaders, those in charge must be committed to the process and to equipping managers within the organisation with the skills they need to be successful.

Likewise, to develop sales reps you’ll have to be dedicated not just to making sales, but to building a culture that allows reps to grow and improve their skills.

Be sure to provide your team with plenty of opportunities to learn and develop themselves, while also putting in place steps that help build a wide understanding of the importance of sales – hopefully, this will also create budding sales leaders of the future.

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Published by Red Flag Alert January 14, 2010

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