Sales leaders often struggle when managing Sales Under-Performers across their revenue teams. In this special Office Hours session, host Mark Cox and co-host Dave Hanley answer critical audience questions on diagnosing pipeline lag and fixing team performance gaps. You'll hear practical advice on why you shouldn't pour all your coaching hours into struggling reps at the expense of top producers. They unpack the real difference between lack of skill, poor work habits, and wrong cultural fit. Mark and Dave also break down how to handle high-revenue clients who drain your team, plus how to merge sales cultures during corporate acquisitions.
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Office Hours - Episode 7 - Dealing with Sales Under-Performers
Mr. Hanley, good to be back after a brief hiatus in Italy. If I start breaking into Italian with some of my responses, we will use the prompter, the translator.
There is got to be some translation we can do nowadays with AI on the show, so no big deal.
How are things for you?
I cannot complain. It is in my neck of the woods. The weather is starting to get beautiful. Fall is the best time of year here, so it is amazing.
Team, for us, we love it too. I am just back from a vacation because we always vacation right before Q4, because it becomes such a crazy period of time for the next 90 days. You are all experiencing that right now. In our next couple of Office Hour podcasts, we are going to try and address some of the issues with Q4 once we are in the heat of battle. Super excited for the conversation, and keep those questions coming in, please. Thank you. They are awesome.
Q4 is always an exciting time for those of us in sales. It sure is.
What have we got today, sir?
Mark, we got a few good ones. Let us start off with a question from our friend Darren here. Darren says, “I run a large sales team, and like most, we have a group of top performers, some average players, and some that are significantly underperforming. I am thinking about teaming up my top performers with some of my lower performers to help them, to help mentor them to boost their results. Is this something you would suggest?”
I get this kind of question a lot.
I figured, yeah.
Stop guessing why your reps miss target. Diagnose skills, activity volume, and role fit before you make a move.
Diagnosing Root Causes of Sales Slumps
We really do. You say, how do you use your time and where do you spend your time? Just a couple of thoughts. Dave, I know you have lived through this a lot. A couple of thoughts to think of. The first one is obviously, why are they underperforming? People underperform for a variety of different reasons. They do not know what to do. Maybe one thing. Number two, they do not want to do what they need to do. Number three, they are new. They are onboarding, and they are ramping up. Context matters in every sales role.
Holding Direct Conversations About Performance Gaps
You have got to give somebody a reasonable period to ramp up. When you talk about underperformers, I think this is where sales leaders really have to get into it and understand why they are underperforming. The second thing is a sales leader you need to be comfortable with. This is not always comfortable, but if you go to Kim Scott and Radical Candor, we need to be communicating to people so they understand our view that they are underperforming. They understand our view as to why they are underperforming.
Prioritizing Top Performers Over Struggling Reps
First, let us diagnose why somebody is underperforming. The second thing to think of in your team, you are always going to have A, B, and C players, in terms of performance, for sure. The knee-jerk is, “Let me work on the C players, those who need the most help.” It is actually the opposite of what we should do. As a sales leader, you have got to be concerned about sales productivity. In any given quarter or any given year, it is actually an investment of my time, which is limited. I am to get a bigger bang for the buck by actually working with the people who are already A players.
As A player, I am going to get a higher return. I want to keep those players. I want to continue to challenge a player because if I have a supportive environment where I do not challenge somebody, they become complacent. If I have a supportive environment where I challenge them, they are going to grow. If I challenge somebody in a non-supportive environment, they burn out. I am really enjoying Angela Duckworth's latest book, Situated. Her first book was Grit. Her latest book is called Situated, where you go into this. My counsel to leaders always, we have got to invest time where we are going to get the biggest bang for the buck.
What I want to do is invest with A players to the extent they want our time and support because I am going to get a bigger bang for the buck. The B players, I am going to want to invest in them, because I want to convert them into A players. With my C players, Dave, I am totally and absolutely interested in your feedback. I have to make an assessment. Am I going to be able to get these people to the next level to a B player, or are they the wrong person in the wrong role? For me, this comes back to what we hire on.
We hire on intelligence, drive, humility, passion, and optimism. For somebody who is not performing, are they missing one of those capabilities, one of those assets? Did I think they had it? When I hired them, I realized they do not. It has got to be, in a sales organization, it has got to be up or out to a certain extent. This is the mantra you always hear in professional services firms, up or out. In my view, I applied to a sales team that says, can the C player become a B player, or do we find a new adventure for the C player doing something else that will be their unique ability if sales is not their unique ability?
For sure. It is like my initial take on Darren's question was that he is leading the team. He comes across as if he might not want to deal with it. He is like, “Let us get some of my team members to address the issue.” That is like, let us say, as a sales leader, you do not want to deal with the underperformers because it is difficult. You end up having to let the person go, and you have to have difficult conversations that are not easy to have. That is my first take. As you said, it is figuring out why they are underperforming.
Is it because they do not have the attributes? Do you look at what they are doing in terms of activities? If they are doing the number and the quantity of activities, are they doing them well? If not, then work on the skills. If they are not doing the activities, then you've got to work on the volume and track that. It is usually one of those three things. Just figuring out which it is. Sometimes if it is the attributes, they are just not the right person. That happens. Not everybody is meant for sales.
By the way, not everybody is meant for sales in that particular environment. Is there something about your environment, without judging the environment, that is conducive to a certain person succeeding and other people not succeeding? For example, large-scale enterprise software companies have so much churn and turnover. It is not a collaborative environment, frankly. Nobody supports new people coming on board because they are all under so much pressure. That new person may not be around that long. They literally do not invest time because the person is going to churn out. What is the right type of environment for this individual?
One of the things I will push on Dave, because we see so much of it, is that we will have a conversation with a CRO or a sales leader, and they will share what they are unhappy about in terms of a particular performer or something that happened in a recent sales call, and they will say this about what happened. I would have expected the person to send a follow-up note to the client, to rally our internal resources, and all these other things. I said, “That makes a lot of sense to me. When you shared that with them a week after, it did not happen. What was their response?” They come back and say, “I did not share it with them.”
Unspoken expectations lead to sudden exits. Have the courageous talk with your sales reps early.
They should not know, Mark. They should know through some kind of telepathy what the leader is thinking.
That is right. You said, “None of us like those tough conversations.” By the way, team, I know we always talk tough on these podcasts and everything. Nobody hurts internally more than me when you have got to make a decision like that. It is not going to stop me from making the decision because I just know how it plays out.
That is exactly it. The expectations, it is fine to have expectations, but if the person does not know them, then you cannot really hold them accountable for that.
You cannot. Imagine the tough conversation you have if it goes the wrong way and you have to exit somebody. They are on the other side of the desk saying, “I had no idea.” Just not fair to them. This is one of the things, particularly in the Q4 team, this is why I think salespeople, sales leaders, it is so important that you give yourself white space, you give yourself rest, you recharge because of the tendency to step over the garbage and ignore it and go to the next sale.
Call is very high when you are drained or tired or under pressure. Your job is not just to get the number. Your job is to actually unleash the true potential of your sales team. Sometimes that is positive feedback, and then sometimes that is giving, having a courageous straight talk conversation because people actually do want to know how to get better.
For sure. I heard this adage one time. I forget who said it, but it is like, the thing I am avoiding most is the reason I am here. Unfortunately, that is for sales leaders. It is often dealing with those difficult situations that you just really do not want to address.
Look at that, Darren. What a question off the top to get the juices flowing.
Good stuff. What do we have next? We have got Rachel here. Rachel says, and this is always a fun one, I think. Keen to hear your thoughts. “We have a large customer that brings in a lot of revenue from my firm. They are a constant source of stress. I dread dealing with them, and they always seem to have issues no matter how hard we try to please them. At what point is it not worth it anymore?”
Great question. Why don't you start with this, Dave?
What do you think? The one thing I heard there from Rachel is that it brings in a lot of revenue. She did not mention whether they bring in a lot of profit, because that is one of those things where you have a customer, and it goes back to maybe you signed them on. They were not a good fit. Big client. They are bringing in a lot of revenue, but if you really dug in and said, “We are spending all this time. We have a bunch of support people having to help them out,” I am not sure what kind of business Rachel is in, but if it is heavily services-based or software where they have to support it or make changes.
Sales Under-Performers: Your coaching hours are limited. Invest where you get the biggest return: your top producers.
Evaluating Profitability Behind High-Revenue Clients
You might be losing your shirt on this deal. This client might be costing you all kinds of additional expenses that are just cutting into any margin. That would be like, from my perspective, number one, look at is this actually profitable? That makes it a different decision. If it is just a bunch of revenue that you feel great about because it is pumping up your top line, but you are not being profitable on the deal, then that is an easy decision.
Running Client Health Checks Outside Crises
There are a couple of things to think about too. I was like, why. Totally agree with you, Dave, on that one. Then I would say, “Rachel, why are they so difficult to deal with?” One of the ways to maybe try and get to the bottom of that is something we like to call a health check. For some of our most important clients, what we will end up doing is, a couple of times a year, book a meeting and go, “Dave, why do we not get in the room in two weeks time?” We really want to understand a couple of things. We give a little agenda for it, but we want to have a conversation outside of the heat of the daily battle.
The conversation would be at a high level, not a service-level review, but how are we doing? We want to hear from you. How are we doing? The second thing we want to know is your strategic priorities for the next 12 to 18 months, sub-bullet. How are you progressing against them? Third, we are going to share our strategic priorities moving forward, and we will share how we are progressing against those. The goal of the meeting is that we want to get alignment, and we want to have a conversation when we are not bidding on something, or you just have not called me because you are unhappy.
The ITF Academy has been down for an hour, and you are not happy or whatever it is. One of the things that is very strategic about pulling out from them is when they start to share what is working and what is not, like, how are we doing? I would really be trying to intensely listen to what is working for them and what is not, and have them think about it and articulate it. That is why I like giving like ten days or a week's notice. If I pick up the phone and go, “How are we doing?” Nobody is good at immediately responding to something impromptu in the middle of a day.
You will not get much of an honest answer. You are, yeah, “Things are pretty good.”
Sometimes what we find with these health checks is somebody will walk into the meeting and say, “Listen, I talked to four people you are interacting with on a daily basis. Here are some of the things they wanted me to share.” First, let us understand what is going on in their perception of us, and why they are so difficult. The second thing is that there are difficult clients. We have to just be honest that certain organizations have certain cultures. They might be in a certain type of industry where it is non-competitive, not pointing the finger, but certain countries have socialist systems for telco or banking.
Boy, I wonder who that might be. Because of that, the cultures of the organization are a little bit unique because they are not competing in a real environment. Frankly, they are in a protected environment. You get these folks who have been in long too long and so forth. They are somewhat more challenging to deal with. To me, as an organization, I would go back to the culture of my company and the values of our company and go, “Listen, if interacting with this customer is against our value system, like they are abusing our people, they are not showing respect.” Again, you can call us out. If we failed on something, you can call us out.
Protecting Your Team from Client Mistreatment
The same way we would not expect anybody in The Funnel to feel like they are in a meeting where they are not being respected as a person, we ensure that our clients are not treating people in The Funnel badly either. You can give us feedback that we have missed the mark, but we expect the feedback to be professional and everybody to feel like they are not threatened or bullied or any of those types of things. We have a value system that says you cross that line, and we are not going to work with you. That would just be the feedback and thought. This is a really tough one.
I will just share a personal experience, but as part of my history, I have managed to literally be an account manager for some of the largest business relationships in North America, where clients would spend well more than $100 million in revenue with the company I was working with at the time. You are dealing with 35 people on the client side. At some point in time, there are going to be some of these issues. That is not a client you can walk away with. At the time I was an account manager, I was not in a position of authority to decide who is a client and who is not.
Pull the plug on 100 million bucks.
Schedule strategic health checks with key accounts before an operational fire forces an angry call.
They will change me out. They are going to change me out before they change the client out. It did not stop us from having to, so I tried to take ownership and say, “Listen, they are seeing things happening with members of the team.” I was the executive leading it and saying, “We will not put up with certain types of behavior. If you really need this emotional conversation, do not call somebody on my team. Call me. If you need to unload and that is your behavior and that is your personality, I am fine. Call me. I cannot have people on our team feeling like they are getting bullied or abused.”
It is important, Mark, you said, to have that frank conversation and that health-check type of environment. Honestly, it might be like I have been in cases before where it is just your perception. They are difficult, but they go, "No, we are super happy. They may just have that not-very-good bedside manner in terms of dealing with it. The other thing you might find is that the reason why they are not happy is that you do not have something in your product or this or that. The other thing that might be easy to give them, and there might be an opportunity to make some additional revenue. It is just having that frank conversation is huge. Again, easy to avoid. You are like a pain in the neck customer. I do not want to talk to them. It is important to just kind of nip it in the bud.
Yes, Dave. By the way, Rachel, thanks for this. It brings up so many things.
So many memories, Mark, it seems.
It does, by the way. You can see me sweating when I started to think about it. One of the other things that, as I get older and maybe after COVID, I am a little more aware of is that I think we also have to understand that people go through things that have nothing to do with us or business. Rachel, I do not know the stage of career you are at, but when I was in my late 20s, early 30s, and really moving up the ranks, it was all business. Everything had to be super professional. No big family events, no sick parents, no challenging situations, all those kinds of things.
Yet what you realize as you get a little older is that we are all dealing with something at some point in time. We have families, we have personal lives. I try to have a little more empathy these days, and if somebody is not in the right state of mind, I try to think about them instead of the impact on me. Yeah, fair point. We got one more. Two biggies. I am taking the day off after this. These are all taxing.
Lastly, we got Kathy here. This is a little less, maybe not as deep a topic. It is something that definitely hits home for me. Kathy says, “My company is going through a merger, and we are going to be combining two sales teams with fairly different cultures. How do I navigate this? I have never done this before, and I am a bit concerned.”
Mr. Dave Hanley, Unicorn, you have sold your company a couple of times. Your company is a couple of times. Tell me about that. What is your take on this? You have lived this a couple of times.
The key thing to start with is, I think one of the big things when an acquisition or merger is happening is to look at how different these cultures are. That is one of the areas where, if the company over, like it is one thing if it was just the sales team, but if the company itself has a totally different culture than the other business being acquired or merged with or whatever, that is a big challenge. That is doomed to imminent failure in many cases because that is one of the big things that you should be looking at when you are dealing with an M&A opportunity.
Defining Sales Culture During Corporate Mergers
Let us say in this case, companies decided that the cultures are close enough, they make this deal happen. One of the key things to start with is just laying out what your sales culture is. What is the culture of the team? This goes back to my early work with you, Mark. It is like a lot of sales teams have not even figured out and documented what their sales culture is. If someone new starts, they just come in, and they have to figure it out on their own. That is a problem because oftentimes the culture that you see is not necessarily the underlying culture.
Sales Under-Performers: A high-revenue client isn't an asset if their endless service tickets wipe out your margins.
That goes back to the early days with Dave D'Acosta and me when you started working with us. It is like, “Fun environment, we got a ping-pong table, we are messing around.” We work hard, like really hard. Some people would see that as, “I can come in and chill and take it easy,” but when the ping-pong games are over, we are back to grinding and making cold calls, kind of thing. That is important to lay that out. In this case, it is a case where you go in, and you talk to every single salesperson on the team, and it is like, “This is our culture. Any concerns?” Just really put a stake in the ground and make sure everybody is rowing in the same direction. If not, then you might have to try to make a change or figure out if they can conform to that culture.
Great advice, by the way. By the way, that was a great example with you and Dave D'Acosta back in the day, because the first time I met you, one of you was wearing a baseball cap. I am coming in, and I am going, for the love of Pete, what am I going to do? Suddenly we started to have a couple of meetings, and I go, “Wow.” Every time I shared an idea or a concept, you guys would come back a week or two later, and you would show what it became. I thought to myself, “These guys actually executed on that idea better than I would have, like better than I could have.”
It would be confusing to someone coming in to interview you on a Thursday afternoon because you guys were having beers at five and you were playing ping pong and there was music playing. It is spot on, Dave, about the culture, maybe for everybody out there. If you are a leader or even a member of a sales team, I think it is a good idea to think about what the sales culture is that you intentionally want to create for your team.” As a leader, what we mean by that is trying to identify the simplest way is to identify the 4 or 5 values that you want showcased on the team.
People always get confused. What is culture? How do I define it? It is not your mission. Our mission is to elevate the performance and professionalism of B2B sales. We actually improve the lives of professional salespeople. We think we elevate this and turn it into a profession. Anybody selling is going to have a better life. That is our mission. Our culture is different from that. Our culture starts with a client-first mentality. It is the number one value. No matter what we do, we have to put the client first.
Not Mark first, not our company first, not our profit first, but the client first. It clarifies things. We have things like accountability, commitment, teamwork. Those are things that drive results. We explain them to people when they come on board. We also have a value of fun. Unless we are enjoying every day, I just do not think you can do your best. We can laugh, and we can make fun of ourselves, and we can have a great time. We are a bit like you. When it comes to doing something for our client, we expect that we do the best we can, and we are committed to doing it.
I just like that idea, team out there. If you are a leader, we have an exercise called the culture creator where you actually get your team together, and you ask all of them to say, “Here is a tool. Here are 30 values. You could think about it. What are the 5 or 6 values most important to you in terms of our sales organization, and you have them contribute?” The leader is still going to define exactly which ones to pick, but it is nice to have people contribute and say they are all contributing to the type of culture we want to be a part of. What is important to you?
Lifelong learning, another key value for us. We expect to be working with people who are humble enough to know they do not know it all. They are lifelong learners. They are learn-it-alls, not know-it-alls. We prefer working with those kinds of people because it kind of energizes us. That is what I would suggest, Kathy. Maybe if you are the CRO and you have just been taken over by another company, or you are merging with them, maybe that is the first meeting with the other CROs, say, “Listen, let us have a meeting. I would love to understand what you think. Tell me about your sales culture, and I will share my sales culture.”
It makes sense. This is never an easy topic, and hopefully the merger goes well for Kathy there.
By the way, and you the other thing, we are not doing a shameless plug here, but the truth of it is experience in this world, in this realm, is reasonably rare. You think this happens all the time, but not to all the people. Dave, you are really a bit of a unicorn. You have lived through this three times. My counsel would be, gang, find people who have been through this and figure out how to navigate it. Creativity matters, drive matters, all those things. The truth of it is that in business, experience and judgment matter also. Sometimes developing your judgment only comes from experience, or mainly comes from experience, because you learned or lived through something the hard way.
It is so true. It is always important to try to find, no matter what stage of your career, somebody who has been through it before because it is much easier to learn from the mistakes they already made than having to make those mistakes over again.
Combining two sales teams during a merger? Define your non-negotiable sales culture on day one.
I am starting to find just more religion, if you will, mentors. Even at my stage of my career when we start to look at something like the valuation of our company and what do we do in 5 years or 10 years? There are people who have lived through this and then figured out a way of taking what we do and exiting at some point. That is not on the radar for us for another 5 to 10 years. It is probably important for me to find people to help right now and put them on our advisory board along with you and a handful of others. Find those mentors that can coach you through these things too. Dave and I really hope that some of these shows are helpful to you as you are out there going through. Dave, this is always a pleasure.
It was a good one, Mark.
Team, for those of you enjoying these shows, truth be told, Dave came up with this idea. Although we had been doing shows for 5 or 6 years with lots of different people, it was only when Dave came up with this idea that we started this thing, and it actually exploded. Now we are consistently ranked on Apple's top twenty podcasts in the US for marketing. Dave, thank you.
As I said, I get just as much out of these conversations as hopefully the audience does. Hopefully it is helping people navigate all these. Typically sticky situations. Have not got too many softballs. Fire over some softballs for us to deal with next.
That is right. I am exhausted now. I need another cappuccino. I am going to take a nap. Team, keep those comments coming in. You can ask us questions directly through LinkedIn. You can comment on any of my posts, Mark Cox In The Funnel, or Dave Hanley's post. We will see you next time on the show. Thanks, Dave. Always appreciate it, sir.
Thanks, Mark.
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