First-Line Managers: Why Quality Matters

Last week, I covered the three essential components of a positive culture in a sales organization. One of the fundamental drivers is the quality of the first-line manager (FLM). This email will discuss why having a great sales manager is so critical to a sales organization’s long-term success.

It is easy to recognize that a company with a poor salesperson will lose market share in one territory. But if a company has a weak first-line sales manager, the sales organization will lose market share in the manager’s entire area of responsibility. Thus, a poor manager can have an exponentially negative impact on sales results, especially during challenging times such as rising interest rates.

In my view, too many sales organizations under-value and under-invest in their sales management teams. Too often, a company’s sales improvement efforts concentrate on the bottom third of originators who are not matched for mortgage orientation and will not improve regardless of the amount of training they receive. If a company wants to improve sales results, it must focus on hiring and developing better first-line managers.

First-line managers play three critical roles in a company. First, as people managers, they hire and fire the sales staff; drive whether the best salespeople stay (remember producers leave managers, not companies); and influence how well the sales force is motivated and if they embrace changing market conditions. Second, as business managers, FLMs ensure that sales force activity matches to corporate goals, reinforcing the company’s culture. Third, when FLMs interact with customers when doing sales calls, they help strengthen customer relationships.
In the 12 years that my company has spent analyzing competencies of producers and managers, we have found consistently that producers have completely different traits than managers. Managers have 10 core competencies that are composed of 38 personality traits. For instance, coaching and developing others is a manager competency driven by four personality traits: need of recognition; insight; positive about people and need to be liked. Where top producers typically fail when managing is that they do not have the correct amount of “needing to be liked” and” need for recognition.” Usually they don’t care what people think of them which is critical for selling but not when managing. Likewise, top producers who have a need for recognition compete with their employees which can lead to high turnover in their units.

Clearly, the first step in turning around sales performance is for companies to carefully select FLMs with the correct competencies. Here is a sample report of the 10 competencies FLMs should have : View the PDF.
Next time, we will discuss the five best practices of FLMs.