What Sales Teams Can Learn From Warren Buffett’s Wisdom

How can we build effective sales teams for the short and long term?

This is the perennial question that has been asked by sales managers and business leaders for years.

The simple answer is bit by bit, over time by investing wisely in the right things.

Warren Buffett knows a thing or two about investing and his insights and wise counsel hold very true for building highly effective sales teams. Here are some of his famous quotes and how we see them in relation to building sales teams:

There are no bonus points for complicated investments. The truly big investment idea can usually be explained in a short paragraph.*
- This is true for a great sales strategy. A sales strategy should be easily understood by the sales team and the whole business and be expressed in simple language. It should clearly state the purpose of the business and its sales team including which markets we are focusing on; the way we are going to go to market and what values and governance we will stand to when engaging our clients and team members. Go ahead and write a simple paragraph describing your Sales Strategy. Could your sales team follow it easily?
- We have to stop over-complicating sales teams with the obsessive focus on reporting on the numbers and results only (forecasting, pipeline, big data, results, etc.) at the expense of actually working with our sales teams to get them selling better. You cannot coach results, you can only coach activities. We need to invest in the front end getting salespeople to sell better and then the results will come.
- Instead of lumping all clients in one massive go-to-market plan we could instead practice micro-segmentation and equip and direct our sales teams about who they need to specifically sell to and why. Result? More targeted sales activities, client conversations, better sales results and happier clients.
Buy businesses that can be run by idiots. I try to buy stock in businesses that are so wonderful that an idiot can run them. Because sooner or later, one will.
- We need to stop relying on silver bullet point solutions to run sales teams and operations and start putting in place well-prepared sales operations frameworks and good sales strategies that allow anyone stepping into our sales world to have the best chance of getting out there and selling effectively.
- We need to take sales management much more seriously and start to properly train and equip sales managers to be effective sales leaders. Equipping them with the right resources to make sound decisions around sales strategy, market segmentation, account mapping, sales financials, people selection and development, how they lead and deploy their sales teams, and how they work with the executive team ensuring understanding and respect for the sales function in all its complexity. At Barrett, we truly understand and appreciate that sales operations are complex systems and we can help people manage that complexity so that everyone can operate in the light and make informed decisions about what to do instead of relying on gut feel and guesses.
Someone’s sitting in the shade today because someone planted a tree a long time ago.

Developing an effective sales team takes time, dedication, leadership and courage in the face of short-termism and fads. For instance, implementing a 70:20:10 framework that creates a Perpetual Learning Culture leads to increased sales results, better margins, happier clients and accomplished salespeople, and a marked competitive edge.

4. Bad things aren’t obvious when times are good. After all, you only find out who is swimming naked when the tide goes out.

How many businesses and their sales teams have been caught short by the GFC and the many changes in the market place since? Too many. Why? Because too many were not geared for customer centricity still focused on themselves, and they did not look ahead at what was changing, nor did they really listen to their clients and what they were wanting. The result? Too many businesses and their sales teams are in a ‘pricing=race-to-the-bottom’ syndrome because they do not know how to sell value instead of product, amongst other things.

So, to get things going and make sure you are on the right track, here is our sales operations checklist. Do you have the following in place?

Sales strategy, the right market segments supported by the right sales messaging, go-to-market action plan
The right sales structure with clear levels of accountability including standards of behaviour and values so we know what we need to do to deliver better sales results
The right sales processes in place that can be easily taught and applied in the real world
User-friendly technology that helps us to sell and not tie us up in excessive administration
Effective sales managers who lead, coach and support us instead of selling for us
A continuous learning environment that encourages regular reflection and practice and keeps us up-to-date and fit for purpose

*‘Our investments continue to be few in number and simple in concept: The truly big investment idea can usually be explained in a short paragraph. We like a business with enduring competitive advantages that are run by able and owner-oriented people. When these attributes exist, and when we can make purchases at sensible prices, it is hard to go wrong (a challenge we periodically manage to overcome). Investors should remember that their scorecard is not computed using Olympic-diving methods: Degree-of-difficulty doesn’t count. If you are right about a business whole value is largely dependent on a single key factor that is both easy to understand and enduring, the payoff is the same as if you had correctly analysed an investment alternative characterised by many constantly shifting and complex variables.’