Recently my company, MAI, permanently promoted ‘SB’ to the
role of National Vice President (NVP), Sales and Customer Success. Steve reports directly to the company
president and is responsible for the entire field sales organization, including
our sales representatives, specialists, and customer care teams.
SB replaced a fairly unpopular, yet successful, NVP (we’ll
call him, MW) who promoted a bureaucratic (Wren, 2009) and hierarchical (Daft,
2007) chain of command. Despite his
reputation, MW was great at extrinsically (Ryan & Deci, 2000) motivating
his sales reps with added financial incentives and fear.
In his two months of interim leadership, SB has already made
significant changes to the culture on the strength of his affable personality
and energetic personality.
SB is a pretty busy guy, so I sent him an email asking a few
questions related to this week’s readings.
Me – SB, one of the themes of our readings for this week is
the collectivism versus individualism paradox.
One particular company (Great Little Box Company) had success in
promoting collectivism (Heyman & Barrera, 2010), or a spirit of
togetherness. What are your thoughts on
this paradox and what role does collectivism and/or individualism play in MAI’s
sales success?
SB – Casey, as you’ve probably noticed so far, I am very
team oriented. I was a rugby player in
England and my father was a coach so I’ve taken this team approach in my
leadership style. Much of my strategy
and style is intended to build this feeling of “togetherness.” I think this is especially important
considering the tough year we’ve had.
My commentary – Similar to the Great Little Box Company’s
management team (Heyman & Barerra, 2010), SB, is an active communicator who
is very transparent in his approach. We’ve
already had (3) national sales calls in the past three months, whereas we
probably had (2) of these calls in the entire 12 months of the previous
year. On the calls, SB outlines recent
sales victories, challenges, marketing efforts, and a state of our
business. These calls have been well-received.
Me - Another theme of our readings is the importance of
employee motivation. In one of our
readings (Norhria et al., 2008) the authors speak of motivating employees with
4 organizational levers – Reward System, Culture, Job Design, and Performance
Management & Resource Allocation
Processes. How do you intend to motivate
the sales force to achieve company goals?
SB – Sales professionals need to feel supported and excited
about what they are doing and what they are selling. I want each person in our sales team to feel
proud of the team they are on, and the McKesson name on their business
cards. Sales “brings the rain” to keep
the lights on for the entire company, so it’s important that each person knows
how critical their efforts are to our company’s survival. Since I’ve taken over, we’ve worked with
Kraig [our new company President] to change the reward system so it reflects
the importance of our continued efforts.
My Commentary – SB has placed accelerators (higher incentive
compensation) on our existing sales IC contracts for the second half of the
fiscal year (which just ended). These
accelerators are a device used to extrinsically (Ryan & Deci, 2000)
motivate the sales representatives, with the separable outcome being ‘higher
pay.’ Interestingly enough, in sales,
often extrinsic motivation is connected to intrinsic motivation because many sales
representatives get a ‘high’ from winning deals, being rewarded, and getting
recognition.
Me – SB, how do you keep top talent after a difficult year?
SB – Sales is all about relationship building; with
customers and within your company. It’s critical
for me to have a personal relationship with as many of our representatives as
possible. It’s important that I’m able
to communicate our company’s direction with people via conference calls, emails
and meetings. If our company has the
right strategy and I do my job of communicating, I think we have great things
ahead.
My commentary – SB has a full plate right now but I’ve still
been able to see some similarities between our readings and his approach to
leadership. Regarding keeping talent,
SB had probably sensed some
disengagement when he started his interim term, and he has done his best to
build engagement. I think Martin &
Schmidt (2010) would agree with some of his tactics.
References
Daft, R. (2007) "Fundamentals of Organizational
Structure." Organization Theory and Design (9th ed.), pp.
88-125 (Chapter 3)
Heymann, J.,
Barrera, M. (2010) Engaging Employees in the Company's Profits and Their Own, Harvard
Business School, pp. 1-28 (full article)
Martin, J., and
Schmidt, C. (2010). How to Keep Your Top Talent. Harvard Business Review,
pp. 3-9 (full article)
Nohria, N.,
Groysberg, B., and Lee, L. (2008) Employee Motivation: A Powerful New Model, Harvard
Business Review, pp. 1-7 (full article)
Ryan, R., and
Deci, E. (2000). Intrinsic and Extrinsic
Motivations: Classic Definitions and New Directions. Contemporary
Educational Psychology. No. 25, pp. 54-67 (full article)
Wren, D. (2009). The Evolution
of Management Thought. Chapter 10, The Emergence of the Management
Process and Organization Theory, pp. 212-234.
Interesting interview, Casey. I particularly liked your explanation of intrinsic/extrinsic motivation in sales. Isola, a company profiled by Heymann and Barrera (2010), also used teamwork as a way to motivate employees. That same article talked about employee feedback, and that workers need to believe their input is valued. Do you see this in your own company? Did management hear that people had problems with the previous NVP?
ReplyDeleteRegarding employee feedback, I've seen significant efforts from McKesson to "right the ship" by getting employee feedback. Isola's culture mirrored the approachable and open personality of the CEO (Heymann & Barrera, 2010) with the open door policy and the 2 year team rotations, which eliminated middle management and raised engagement. SB has had one-on-one meetings with many of the fields reps upon hiring, asking a series of questions about what each person thinks about the state of our business, including suggestions. I think his open door policy approach has helped people realize they have a stake in the business. Morale is already a lot better than it was before with the other NVP.
DeleteMost people were aware that MW (the previous NVP) was somewhat unpopular. I, personally, really liked his management style. And McKesson has moved him to a higher responsibility position within our corporation. Proof that different management styles can certainly be effective.
Hi Casey,
ReplyDeleteThanks for sharing this inside look at your company. Being in sales, myself, I understand the importance of both intrinsic and extrinsic motivators. Yes, there is a big "high" when closing a deal, and being compensated for it (extrinsic) is also very motivating. I'd have to say, in my experience, both of these variables are are work together to feed the other. In other words, the high I get from closing a sale, drives me intrinsicly and the compensation does the same for as an extrinsic motivator.
Would you say that NVP is meeting the four drivers of, acquire, comprehend, bond and defend (Nohira, Groysberg & Lee,2008) better than the previous NVP? If so, do you think this is also reason for increased employee satisfaction?
Nohria, N., Groysberg, B., & Lee, L. (2008). Employee motivation: A powerful new model. Harvard Business Review, 1-8.
Casey,
ReplyDeleteIt sounds like there has been a huge shift in the management of your sales force. It also sounds like SB has a focus on intrinsic motivation - he wants employees to feel excited about what they do and what they are selling, outside of the compensation structure (Ryan & Deci, 2000).
Your previous posts have discussed the need for a greater team structure within your unit. Do you feel that the increased teamwork is helping the team meet their goals because the members are informed about how their work affects the organization?
Hi Casey. Sounds like SB has come in and has changed things for the better! Do you notice a difference in the way your team is bonding and the communication you have with one another now (other than the monthly sales calls)? Also, I know that being rewarded for a job well done needs to happen quite soon to after that job occurs; are your incentives structured this way? Or do you have to wait a long time after closing a big deal to finally reap the rewards of it? At the healthcare company where I used to work, our bonuses were paid annually; that wasn't very good motivation to push that extra CT or MRI sale at the end of a quarter. Good insight, though, into your business unit.
ReplyDelete