Changing your Business to a Sales Culture
This was a big week for the Irish hotel industry. The annual conference and trade exhibition hosted by the Irish Hotel Federation was held in the Galmont Hotel and Spa in Galway. The theme this year was Mindset to Achieve, which for me, is a fundamental ingredient for any business.
Like every other industry in Ireland, this sector has gone through a lot of change in the last ten years. There have been an extraordinary number of changes in ownership in various hotels around the country. Those that exited NAMA form one group. Those that changed hands privately form another group. And those that have been acquired by the growing number of groups is another cohort.
There is one common denominator in all scenarios. There is more attention today than ever before on commercial accountability. The focus on margin and profit is now relentless. In the days before the crash, many operations did very well by simply opening their doors in the morning. They didn’t have to think so much about ‘selling’ as a skill.
Now there are new challenges. New competition from on-line players and short-term lettings are just some of the threats facing the industry. Payroll, VAT and insurance costs continue to grow faster than revenue for many. Therefore, driving a sales culture so that sales become the responsibility of all departments and at all touch points comes to the fore.
I was invited to speak at the conference and my topic was Customer Experience, the New Battleground for Business. I believe that giving great customer experience goes hand in hand with increased sales. I shared concepts and stories on why there is no contradiction between the two.
Business as usual can work against a sales culture
But it’s not just a message for the hotel sector. Every company in whatever sector is at risk of falling into a rut of ‘business as usual’. What I mean by that is that some companies become so inwardly focused on operations, that they miss the big picture. If you are totally aware of your KPIs, you as a manager may argue that. But honestly, have a look around you. Teams on the ground can often get so caught up in the day job and either forget about sales or were never pointed in the right direction in the first place.
Up and down the country, there are retailers, hotels, manufacturers, distributors and others running on remote control. The doors open in the morning and the system just kicks off. Norms develop and don’t get challenged often enough. Complacency sets in, productivity falls and costs go up.
I worked with a hotel that was taken over by new owners. In order to get a return on the capital investment, new targets were set. Using industry standard ratios, the new owners estimated the payroll cost of one particular department was too high. It quickly became apparent that the team needed to be reduced in size.
Based on that metric, the old team of fifteen were running at twenty percent productivity. It was decided to reduce the team to five, by working to dramatically increase productivity. As you can imagine, that put the cat amongst the pigeons. The team morale dropped like a stone and chaos ensued. They mourned their old friends leaving and resented being put under pressure to work harder.
Change Tips for Refreshing your Sales Culture
From a pure commercial perspective, this management team did the right thing. Disruption of this scale is bound to have a negative impact and I feel that no amount of ‘doing the right thing’ will prevent it. But for sure, the impacts were mitigated with these steps.
1. Understand the change
Be tolerant of your team’s past and old way of working. It may not be their fault that complacency and unproductive norms developed. Leaders have a lot to answer for in such cases as they enabled the past by tolerating it.
2. Set the context
Take time to explain the big picture to your team. Just because they don’t have stripes on their arms, doesn’t mean that they are stupid and won’t understand the implications of achieving targets, or not! In this case I explained the workings of a P+L by comparing it in a non-condescending way to an employee’s take home pay. For example, if one earns €100 per week, but spends €105, that’s a problem. Of course, they got it.
3. Set targets
Targets are an effective way to motivate and provide clarity. The members of sales and marketing department are already well-used to this. For those not seeing themselves as salespeople, consider breaking the targets down. For example, how many extra bottles of wine or desserts do we need to sell, to hit the target? And make the targets fun, by incentivising your teams with nominal prizes.
4. Train your people
Everyone has a role to play and can contribute to the sales effort, but not everyone knows how. In the example above, there was a time management challenge in setting regular time aside to train the teams. With less people doing the same job as before, they will each need to up their game. Don’t let anybody say they weren’t trained how to do it. Whether you organise group bite-size training sessions, or one-to-ones, give training top priority.
5. Communicate and give feedback
Regular updates in frequent briefings are reassuring and motivational. Set aside the time, even if it’s just fifteen minutes once a week. This ensures that the management point of view is cascaded, obstacles are identified early and corrective actions are agreed on time.
6. Reward effort and achievement
In a time of change when people are making great effort to adapt, they should be recognised for that. So go out of your way to do as Kenneth Blanchard advises – try to catch somebody doing something right!
This advice applies to all businesses and not just hotels. Nor does it just apply to those that have gone through a change of ownership. Every business needs to grow sales. And sales is not just the responsibility of the sales department.