How do you run branch sales teams to one standard?

Why do branch sales teams drift apart?

A sales leader with five branches runs five versions of the sales team. Some of the differences come from the market each branch serves. Some come from how each branch sells. When the words in the pipeline mean different things from branch to branch, the leader cannot tell the two apart, and the coaching lands on the wrong branch.

Variation inside one company is normal. Working with the US Census Bureau, Nicholas Bloom and colleagues surveyed management practices at more than 35,000 manufacturing plants in 2010 and again in 2015. About 40 percent of the variation sat between plants of the same firm, and that share was larger in firms with more plants. Management practices accounted for more than 20 percent of the variation in productivity (American Economic Review, May 2019). These are factory data, and the split is descriptive. A platform that grows by adding branches should expect a spread of its own.

~40%

of the variation in management practices sat between plants of the same firm.

Bloom et al., AER 2019 · US manufacturing plants

What questions bring branch sales teams to one standard?

Six questions, and one that sits under all of them.

Do our branches mean the same thing by the words in the pipeline?

Each branch learned its pipeline words from whoever built it, and a branch that joined through an acquisition brought its own. Ask two branch managers what makes an opportunity qualified, or when a renewal counts as at risk, and listen for whether the answers match. Where they differ, any comparison between those two branches measures the words before it measures the selling.
Which differences between branches come from the market, and which from how they sell?

Some branches serve markets with older buildings and fewer competitors, and their numbers will look different for reasons no coaching will change. In the Bloom study, when the authors accounted for each plant's industry and metro area, the share of management variation inside firms fell from 42 percent on average to 19 percent. Part of what looks like a gap in practice tracks where a unit sits and what it does. Listen for a branch manager who can describe the market and the team's habits as two separate things. Be wary when every gap is the market's fault, and equally wary when none is.
Who owns the branch's sales result, the branch manager or the sales leader?

When the branch manager runs the branch P&L and a sales leader carries the sales number, the result has two owners, and a result with two owners tends to have none. Listen for one name next to each branch's sales result, and for a branch manager who talks about that number as their own. The manager closest to the team moves the result. In one technology-based services company, Lazear, Shaw and Stanton found that replacing a supervisor from the bottom 10 percent of boss quality with one from the top 10 percent raised team output by more than adding a worker to a nine-member team (NBER working paper, 2012, revised 2013). That is one firm and frontline supervisors, so read it as a direction.
What does the best branch do that the others do not?

The best branch is the cheapest teacher you have, and it often cannot explain itself. Gabriel Szulanski studied 122 transfers of best practice inside eight companies and found the main barriers were about knowledge, led by the receiving unit's limited capacity to absorb the practice and by ambiguity about why it worked (Strategic Management Journal, 1996). Motivation mattered less than conventional wisdom held, though he cautions that the design is correlational and the sample small. Listen for a best-branch manager who can describe what the team does in terms a peer could try. Be wary of "they just have better people."
Where should branches be free to do it their own way?

A standard that covers everything leaves branch managers nothing to decide, and one that covers nothing leaves you comparing guesses. Listen for a leader who can say which few things must mean the same everywhere and why the rest can vary. Local judgment is worth more where markets differ most. Acemoglu and colleagues, studying French and British firms in the 1990s, found that firms in more varied environments were more likely to hand decisions to local managers, a correlation consistent with that idea (Centre for Economic Performance discussion paper, May 2006).
How much does the center ask of branch managers at once?

Every new initiative competes for the same branch manager's week, and a new standard is one more initiative. David Garvin and Lynne Levesque studied one office supply company for two years and gathered data from 12 other multiunit companies (Harvard Business Review, June 2008). Without someone filtering what headquarters sends, they write, frontline managers "might feel overwhelmed by a constant stream of initiatives." Listen for how many separate asks from the center a branch manager is carrying right now, and which of them have stalled.

The question under all six

"If I compared two branches tomorrow, would I be comparing the same things?"

This question sits under the others because every answer above rests on it. A market adjustment means little when the numbers it adjusts were counted in different ways. If the answer is no, the first conversation is about words.

What are the signs your branches run to one standard?

Good signs

Any two branch managers give the same answer when asked what makes an opportunity qualified.
Branch managers talk about their market and their team's habits as separate things.
Each branch's sales result has one owner, and that person knows it.
The best branch manager can explain what the team does differently in terms a peer could try.
Branches differ on purpose, and the sales leader can say where.

Warning signs

One branch's pipeline looks far larger than its peers', and nobody has asked what it counts.
Every gap between branches gets blamed on the market.
The branch manager learns the branch's sales result from the sales leader's report.
A practice from the best branch reaches the others as a memo.
Each branch keeps its own spreadsheet beside the CRM.

Case study Fictitious numbers

A PE-backed commercial mechanical services platform runs two branches of similar size. Last quarter, the North branch reported 120 qualified opportunities and the South branch reported 48. Each branch won 18 jobs. On paper, North won 15 percent of its pipeline and South won 37.5 percent, and the sales leader had spent the quarter coaching South to build more pipeline.

The sales leader sat down with both branch managers and asked each to describe a qualified opportunity. North counted every request to price work, down to small repairs its technicians flagged on site. South counted fewer, and its manager could say why each one was there. The two managers agreed on one meaning and recounted the quarter. North's 120 became 54, and the other 66 fell outside the meaning both managers now used. South's 48 held.

North, as reported

15%

18 won of 120

North, shared meaning

1 in 3

18 won of 54

South

37.5%

18 won of 48

Qualified opportunities, before and after both branches used one meaning

North, as reported120 qualified · 18 won · 15%

102

North, on the shared meaning54 qualified · 18 won · one in three

66 outside the meaning

South48 qualified · 18 won · 37.5%

Won
Qualified, not won
Counted before, outside the shared meaning

The gap that drove a quarter of coaching was mostly a counting difference.

On the shared meaning, North won 18 of 54, a third of its qualified opportunities, and South won 18 of 48, or 37.5 percent. The gap that had driven a quarter of coaching was mostly a counting difference. What remained was small enough to ask about the markets first. North's territory held more aging equipment and more repair requests, and South's held more new construction. The next conversation was about what each market holds, and both managers walked into it using the same word for the same thing.

FAQ

How do you compare sales performance across branches?

Start by checking that each number means the same thing in every branch. Then ask what each market holds before you judge how each team sells. In Bloom and colleagues' study of US manufacturing plants, accounting for industry and metro area cut the share of management variation inside firms from 42 percent to 19 percent. Factories differ from sales branches. The point that carries over is that location explains part of any gap between units of one company.

Should every branch use the same sales playbook?

Share the parts where consistency changes the result for the customer or makes branches comparable, starting with the words in the pipeline. Leave room where markets differ. Acemoglu and colleagues found that French and British firms in the 1990s facing more varied environments were more likely to hand decisions to local managers, a correlation from older data. A playbook written for one market reads like a rulebook in the next.

What does a regional sales manager do in a multi-branch company?

In Garvin and Levesque's study of multiunit enterprises (Harvard Business Review, June 2008), the managers above the front line carried profit and loss statements that grew with the number of units reporting to them. They also filtered the data and initiatives headquarters sent down, so store and branch managers were not swamped. In a services company, ask how much of that filtering your regional managers do, and how much reaches the branches untouched.

How do you share best practices between branches?

Expect it to be harder than it looks. Szulanski's 1996 study of 122 best-practice transfers inside eight companies found the main barriers were about knowledge. The receiving unit's limited capacity to absorb the practice mattered most. Ambiguity about why the practice worked came next. Motivation mattered less than conventional wisdom held, with the caveat that the study is correlational. A memo rarely carries what the best branch knows.

How do you run branch sales teams to one standard?

Why do branch sales teams drift apart?

What questions bring branch sales teams to one standard?

Do our branches mean the same thing by the words in the pipeline?

Which differences between branches come from the market, and which from how they sell?

Who owns the branch's sales result, the branch manager or the sales leader?

What does the best branch do that the others do not?

Where should branches be free to do it their own way?

How much does the center ask of branch managers at once?