TOM will do it

Transformation of the global sales organisation of an automotive supplier

At first glance, all the prerequisites for successful sales work had been created: a new organisation with business units (BUs) clearly aligned to customer segments and corresponding sales roles; an overarching sales management system for channel and product management and detailed target processes as part of a process house. In addition, change managers were established as contact persons in the area to support the change. The start of the new organisation also went largely smoothly - only the expected increase in performance did not materialise, as key objectives of the reorganisation were not achieved: more exchange on successful negotiation strategies between the key account managers, proactive approach to potential sales opportunities outside the BU, early reporting of risks, further development of the portfolio to include attractive, high-margin products. All in all, despite all the formal changes, employees and managers continued to act as they did in the old organisation.

In our experience, this is not a surprising finding: during transformations, it is important to communicate very clearly what the new organisation should achieve in the future and what is expected of individuals. Without this clarity, structural and systemic changes alone are largely ineffective.

In dialogue with the responsible CEO, we have created precisely this clarity and codified it in a simple, comprehensible and, in particular, attractive Target Operating Model (TOM). The core elements are

  • Overarching goals of the future direction
  • Basic logic of the new sales management
  • Core levers for increasing performance
  • Most important (high-level) collaboration processes
  • Central responsibilities and committees
  • Illustration based on use cases with specific fields of application

It was crucial to develop this target model step by step in an agile approach from the work on specific sales initiatives (instead of spending a lot of time on conceptual detailing again). In this way, we jointly ensured rapid impact and, at the same time, practical development in which the various BUs and sales roles are mapped. The cornerstones of the agile development approach were

  • the joint development of the most important guidelines of the TOM in a cross-BU and cross-functional team across several management levels,
  • iterative-incremental concretisation of the model using a BU as an example with gradual expansion of the functional scope and
  • closely synchronised sprint logic for the development of concrete results in "hackathons" (weekly daily workshops) and regular reviews with decision-makers.

This quickly resulted in a practicable and tried-and-tested version of the TOM. In the subsequent implementation, we ensured a good balance of top-down and bottom-up elements in order to provide sufficient orientation, but also to create the necessary degree of freedom for sales employees to take their own initiative:

  • Convincing presentation of the TOM cornerstones by credible managers at a central event (reason-why, benefit translation and use cases for all roles);
  • Setting minimum uniform guidelines and standards for a few core processes, beyond which clear, decentralised degrees of freedom;
  • Accompanying establishment of a corresponding implementation process with the interlinking of review meetings at Management Board level with explicit delegation of responsibility to the operational level (e.g. full transparency on price limits with increased degrees of freedom for KAMs).

Sustainable anchoring of the transformation requires understanding, actual changes and clear consistency at two levels:

  • Securing the change in behaviour through role modelling by managers - if they act convincingly, work clearly within the framework of the new operating model and, in case of doubt, personnel consequences are also drawn, the organisation will follow. Further elements to strengthen the behavioural change are training and peer coaching to remove potential technical hurdles for the sales team.
  • Provision of customised systems and framework conditions - the necessary tools must be user-friendly and easily available so that they are accepted. However, they must also simply be unavoidable at key points. Only through consistent utilisation can the overall and individual positive effect be achieved. This often means switching off special processes. This also applies to the newly created collaboration formats and routines, which require both clear consistency in implementation and compliance.

The joint development of a clear target picture, the optimal balance of push and pull in implementation and the parallel addressing of systemic and behavioural levers have now resulted in a significant increase in sales performance - the budgeted turnover was exceeded by more than 20% and the margin was increased at the same time thanks to the clear focus on more profitable products and attractive customer segments. And this was achieved with lean consulting support focused on the decisive phases, in which functional sales and change expertise was dovetailed with the implementation-oriented hands-on skills of the organisation.

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Dr. Axel Sauder
Dr. Axel Sauder
Partner

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