Top sellers are the backbone of your sales team. Leadership teams want to replicate that talent and disperse those skills among other reps. So it makes logical sense to promote your top sellers, right? Not exactly.
There’s a name for this—the “Peter Principle.” We promote based on people’s success in their current role without considering the skills and traits they’ll need to succeed in the new position.
That’s why your top sales reps, the champions of your business, can make terrible managers. And promoting them can have dire consequences.
As the founder of RevDimensions, LLC a specialty consulting firm that helps SaaS companies grow and optimize their sales teams, Eric Nelson has seen this play out at companies repeatedly. With over three decades of experience in sales, Nelson was the SVP of HireVue during its years of rapid growth and today specializes as an Interim CRO engaging with high-growth SaaS companies around the world.
“If I make a mistake hiring the wrong salesperson, I impact one region. If I make the mistake of hiring the wrong manager, I run the risk of impacting eight regions,” he said.
Nelson has observed that hiring a bad manager is five to ten times more impactful than hiring a bad salesperson. It disrupts productivity, creates a stressful work environment, forces reps to leave, and impacts your bottom line.
“One bad manager has the potential to dramatically set your sales team back—proceed with caution,” Nelson said.
Let’s examine why your best salespeople won’t make good managers and what you can do instead.
The skills required to be a top-performing sales rep and a great manager aren’t always the same. Nelson says they often clash entirely.
“Running a sales team is like running a hockey team,” Nelson said. “Being an individual contributor is more like being on a tennis team.”
Both are technically team sports, but one’s success depends on everyone working together (manager) and the other’s relies on the individual (sales rep). Sure, there’s a team element, but it isn’t the leading contributor to the sales reps’ success.
Promoting your top sales rep based on performance alone could spell disaster for your team.
A study by the National Bureau of Economic Research showed that a salesperson who closes twice as many sales is 14% more likely to earn a promotion. Yet, team sales begins to decline when led by managers who made at least twice as many deals.
So why aren’t stellar salespeople performing as managers? The same skills that make them good at selling hinder their ability to lead. Here are four reasons why stellar sales reps can sometimes turn out to be bad managers.
The harder a sales rep works, the better they’ll do, and (often) the more money they’ll make.
“As a rep, you have a sense of independence and self-direction that’s valuable in that role, but that may actually inhibit you in your next role as a leader,” Nelson said.
Sales reps are used to relying on themselves. They have to make many big decisions in isolation, and when they succeed they build self-confidence. They have to give up that independence if they want to be an effective leader.
Why this doesn’t work for managers: Managerial and leadership roles seem like the next natural step for sales reps, but Nelson admits that it comes with one big drawback.
“Your stress will multiply exponentially, but your finances may not,” he said.
Depending on commission and bonus structures, sales reps may even make more money than their manager counterparts. For new managers, this often means relying more on the team for success (monetary or otherwise) than on themselves.
As sales reps, their output and success had a one-to-one relationship; if they worked harder, they had better results. That’s not always the case when they become a sales manager. Managers need to work for the betterment of the team through servant leadership.
What makes a top sales rep? Their ability to hit their goals. Sales reps are often motivated by short-term wins, like meeting their sales numbers or hitting their quotas.
A salesperson is used to closing the loop quickly. They work hard to close a deal, and once they succeed, they move on to the next.
Why this doesn’t work for managers: Managers need to look at the long-term goals of their team. Success isn’t measured in a few days or even a few months. Instead, managers have to gauge their wins based on meeting long-term strategic initiatives as a team.
Top sales reps are often detail-oriented. That’s what it takes to move the sales process from start to finish. They focus on getting the details right and keeping everything organized throughout long, complex sales cycles—and their clients appreciate them for it.
Being in the weeds may work well for sales reps, but managers need to balance zoomed-in tasks with the bigger, more strategic picture.
Why this doesn’t work for managers: A manager who lives in the details may fall prey to micromanaging. Since they’re used to controlling all aspects of a project, they might have trouble backing off and letting their team members make their own decisions. A manager like this one might take over instead of coaching sales reps through difficult situations.
Focusing on the details also overwhelms and distracts from the bigger picture.
A healthy dose of competition works wonders in a sales environment. Whether your team works with a tiered commission, posts top sales numbers or runs friendly competitions, it’s a strong motivator for a certain personality type.
But the motivation to be the best focuses on the individual instead of the team.
Why this doesn’t work for managers: Fostering teamwork is difficult when a manager is still focused on individual success instead of team wins. While healthy competition motivates a team, unhealthy competition does the opposite.
A competitive leader may find it harder to connect with their team members and make the switch from competition to collaboration.
It all comes down to motivation. Nelson said a good sales leader wakes up in the morning thinking about the best interest of their team and helping them achieve their objectives—not about meeting their personal goals.
Good sales leaders:
- Thrive on coaching, teaching, and watching others get the spotlight
- Get gratification from the intrinsic benefit of serving others
- See the bigger picture and know how to build a path to get there
- Can delay the thrill of short-term wins in exchange for long-term success
Even though sales and management require different skill sets, some skills translate easily between the two positions. Here are some overlapping qualities you’ll find in your top sales reps that will benefit them as potential leaders.
Successful sales reps are particularly good at reading people. It’s how they connect with customers. They pick up on how customers speak, what motivates them, and what information they need to make a purchase.
As a sales leader, they need the same skills to work with their team. Their situational fluency helps them read team members and adjust their management style on the spot—particularly helpful for delivering feedback and coaching reps.
Salespeople are always looking for ways to improve—that’s probably what helped them become top salespeople in the first place.
According to an article in Training Magazine, businesses with a sales coaching culture perform 17% better than those that don’t.
New managers need to be just as coachable. Since they have to learn entirely different skills to be good at their new job, they’ll need the same humility and flexibility that helped them grow.
As Nelson says, top salespeople are great at “picking their horses.” They can look at ten opportunities in front of them and know which three they need to spend 80% of their time on and how to spread their time across the other seven.
In sales, top reps excel at identifying which leads are closest to closing and worth their time and energy. A manager also has to assess where to put their efforts and their team’s. They’ll know how to prioritize their own time and their team’s time to maximize their resources.
Your best salespeople know how to turn a no into a maybe and maybe into a yes. How do they do it? Using different angles to approach a situation until they find the one that works.
It’s an inherent trait that’s hard to teach. It’s the grit to make something work in the face of adversity—the stick-to-it attitude that motivates sales reps and leaders to keep going until they see results.
With the right training, salespeople can be great leaders.
If you have your sights set on a sales rep for the next promotion, good training makes all the difference.
Do most sales teams train their newly promoted salespeople to become good managers?
“Great sales teams do. Most don’t,” he said.
Set new leaders up for success with these tips:
- Don’t give new managers their own sales goals. Some small sales teams may need hybrid sales and leadership roles, but if you can avoid the overlap, do so. Sales and leadership are often in conflict—one focuses on the individual and the other on the team. Putting a new manager in charge of both as a “player-coach” will make it difficult for them to shake off old sales habits and embrace their leadership position.
- Augment managers with AI. Between forecast meetings, planning, strategy sessions, and ride-alongs, sales managers are stretched incredibly thin. 47% of sales managers spend less than 30 minutes per week coaching. Using Quantified AI, our AI-powered sales role play and coaching platform, we provide sales managers with observable game tape and data on what to coach on, as well are reps who are more aware of where they need help to perform like a top performer.
- Provide ongoing management training. Dedicate the same level of training to your management team that you do to your sales reps. Since leadership requires different skillsets, new managers need coaching to learn the job. Offer role-playing opportunities that focus on coaching, hiring, conflict resolution, and more.
Between the current economic climate and innovations in AI, we’re likely to see a more thoughtful approach to sales leadership. Businesses can no longer afford to throw bodies in sales and rely on sales managers to train, lead, and work on long-term strategies.
Will you even need sales managers in the future? The jury’s still out. One of our more progressive clients has replaced all of their sales managers with internal coaches. Other sales leaders speculate that AI could replace middle management or drastically reduce their numbers. But we’re not calling it just yet.
For now, expect to see a focus on upskilling workers and systematizing sales flows, from prospecting to lead generation to role play and training.
Are you ready to speed up training, shorten onboarding and lead your team with data-based insights? Request a demo to see how Quantified can improve your entire sales team.