At PersistIQ, our goal is to make outbound sales simple and effective by using the latest in technology while maintaining the human touch. Over the years, I’ve worked with hundreds of sales organizations. Each one has presented us with the same question: Given all the new sales technology, what is the best way to approach sales development at my company?
A useful way to approach this question is to consider centralized and decentralized sales team structures. In the decentralized model, individual sales development reps are tasked with generating pipeline, from finding new prospects to booking appointments. In the centralized model, one person (or a small team) is responsible for all or the majority of outbound sales efforts.
Choosing the right sales team structure for your organization can be tricky. The answer may not be as black and white as selecting one model over the other. In this article, I'll demystify both models and help you determine the best sales team structure for your business.
Decentralized Sales Team Structure
In this model, individual sales development reps are responsible for most, if not all, of the organization's outbound sales efforts:
- Prospecting, which includes identifying target companies and individuals, tracking down their contact information, and collecting any relevant intelligence
- Planning and executing all outbound sales activities (emails, phone calls, social selling, etc.)
- Analyzing and optimizing their sales performance
The decentralized model has distinct benefits. Whether deliberate or not, organizations that adopt this model often run sales experiments in parallel. Plus, individual sales reps have more freedom to be creative in how they perform their duties.
Traditionally, most sales organizations adopted this model because it required little, if any, technology.
Software built specifically for sales development is making the decentralized model more effective than ever. By empowering reps to work smarter, they spend less time on the menial tasks that once took hours each day. Sales managers also benefit from better data management, team collaboration, admin-level controls, and insight into team performance, from individual emails to entire strategies. This technology is opening the door to new ways of working, while empowering the sales organization to work in concert and learn faster.
Centralized Sales Team Structure
In this model, one person (or a small team) is responsible for the majority, if not all, of the outbound sales efforts. This person acts on behalf of the sales development reps and is responsible for the following:
- Sourcing, cleaning, and organizing prospect data
- Developing outbound messaging (usually in conjunction with marketing and sales)
- Crafting the communication strategy (number of touchpoints, channels, wait periods, etc.)
- Executing the outbound sales activities (on behalf of reps)
- Analyzing and optimizing performance
- Managing the tools and systems
In essence, the centralized model makes outbound feel like inbound for the sales development reps. Their job doesn't begin until a prospect replies to an outbound campaign. In other words, the SDR is shielded from all prospecting and outbound sales activities.
Until recently, implementing the centralized model was difficult. The application-specific software was simply not there to support it. As a result, sales organizations were forced to either build a custom solution or hack marketing automation software, which was built for an entirely different use case. These ill-fitting systems led to costly mistakes, from burning good leads to damaging the company reputation.
Like the software built specifically for sales development, new software has emerged to manage sales communication and workflows. This technology empowers sales teams to send authentic and personalized communication on behalf of individual reps. The best part? It's coordinated from a single point, which is the foundation of the centralized sales development model.
Choosing the Right Sales Team Structure
So, what’s right for you and your sales organization?
The good news is that technology is no longer a determining factor. The choice is yours.
As you evaluate the two sales team structures, consider these questions:
- Where are the strengths in your existing team?
If you have strong SDRs or AEs who prospect, consider adopting a decentralized sales team structure. If your SDR team is new and inexperienced, but you have a strong sales development or sales operations person, consider adopting the centralized model.
- How accessible is prospecting data for the market you sell to?
In the centralized model, data is gathered, cleaned, and organized in advance. Communication tailored to each prospect is then created and later sent automatically.
In the decentralized model, data collection and prospect research can be done in real-time. For example, if a sales rep sees a news article or comes across a relevant person’s profile, they can record it.
- What is the contract-value-to-acquisition cost ratio?
Centralized may work better if your contract value is relatively small for each customer. Decentralized requires human input, which can be expensive. For this reason, it works better for larger contract values.
Hybrid Sales Team Structure
Do you have to pick just one model for your sales team?
We’re starting to see sales organizations adopt a hybrid sales team structure, which combines elements of both models. You can do the same, but be sure to know why you plan to run both and have a clear strategy.
At PersistIQ, we use a hybrid model: decentralized for our mid-market customer segment and centralized for our SMB customer segment. The hybrid model empowers us take a highly targeted and personalized approach to outbound sales.
We’ve found the centralized model to be highly effective for our mid-market customer segment.
Our salespeople are proactive and excel at research. Plus, they’re skilled at crafting an outbound sales plan for each individual organization. These qualities make the centralized model possible.
By accelerating the process from prospecting to first touch, our software helps our salespeople scale their efforts. As a result, they’re more effective.
For our SMB customer segment, we prefer the decentralized model.
The data in our market is pretty accessible. It's also relatively easy for us to structure. As a result, we can craft highly relevant and personalized communication at scale.
Using this model, we can generate new business opportunities at a cost that suits the smaller contract values within the SMB segment.
Sales Software That Supports Both
Using one system to run both outbound sales models has tremendous benefits. Not only is working with one system straightforward to set up and maintain, but it’s also easier to train, develop, and grow your team. The best part is that it makes it easier to transition between models, which empowers us to run experiments and update our strategy as needed.We’re at the beginning of a new and exciting time when sales workflow technology is finally being built for front-line salespeople—and the implications are going to be massive! So have fun, and let your ideas run wild. And, if you want to discuss this in more depth, don’t hesitate to reach out to me directly.