Territory management is a primary focus for sales operations, especially in large organizations. Efficient territory management brings along many benefits but it’s also cumbersome without the right processes in place. Figuring out the best solution to secure the highest opportunity potential can be a challenge. Sales organizations approach territory management with the help of either homegrown systems or third-party software and services. Let’s take a closer look at the available solutions and their pros and cons.
Very few companies can balance territories and accounts using simple spreadsheets. There are simply too many elements at play – accounts, territories, salespeople – which stretch the capabilities of a spreadsheet. They are also error-prone – especially when used on a large number of accounts. In addition, spreadsheets lack audit compliance and real-time visibility into feedback coming from the field.
Some organizations are able to import their spreadsheet data into a mapping solution but the result is often difficult to synchronize with the rest of the required systems.
Very few companies can balance territories and accounts using simple spreadsheets.
Some DIY leaders count on IT to design their company’s territory management solution. Sometimes, for good reason, doing things in-house can make small changes faster to implement. But in my experience, problems follow the launch of a homegrown system. First of all, maintaining and integrating it with other enterprise software can be costly and laborious. Even when IT manages to integrate everything, the homegrown system may break down when third-party software is patched or upgraded.
Though homegrown systems are relatively flexible to change, they require a large investment of IT resources, which ultimately makes system maintenance slow and expensive. This turns them from a tool that should drive sales, into a sales bottleneck.
Operating in isolation is also a disadvantage of homegrown solutions since they don’t benefit from the application of emerging industry standards, unlike solutions from third parties.
Lastly, with homegrown territory management, business continuity hinges on knowledge retention, often concentrated in the hands of one or two individuals in the IT department, instead of on a commercially-backed sales system of record.
Integrating homegrown territory tools with other enterprise software can be costly and laborious.
Territory management software
There are several third-party applications on the market, designed to help sales organizations build new territories from zip codes, counties, or states and balance them by opportunity and workload. This commercial software offers many advantages, including that many customers can vouch for its capabilities. It is also supported and maintained by the vendor instead of the customer.
However, many of these applications approach territory management simplistically, offering a narrow set of capabilities (they simply define territory structures based on a set of attributes and incorporate assignments and crediting logic). Also, the software is not very effective unless the customer first integrates it with their CRM and/or sales compensation software.
“More than software” approach
Software is only as good as the business processes it automates. Finding a suitable territory management solution is often not the biggest challenge sales organizations face anyway – it’s having too many processes that are disconnected, and often, a lack of internal expertise in the business of territory management.
To solve this problem on all fronts, many of our clients subscribe to Sales Operations as a Service (SOaaS) ̶ a comprehensive set of sales operations management services that uniquely combine cloud-based software and collaborative business process management.
SOaaS is not the traditional “lift and drop” outsourcing. While it does augment the client’s sales operations staff, it’s much more than that. SOaaS delivers the right business processes and the best industry know-how to the organization.
In a SOaaS engagement, we help the customer’s sales operations team implement a holistic strategy and capture all of the perks and benefits of a territory management plan. This approach uncovers territory misalignments which may hide issues with the overall compensation plan. Sales ops also benefit from detailed analytics for different roles across the organization, which help them react fast to changing market conditions.
Sales managers also benefit from more time they can invest in tactical decisions. Recent research shows they typically spend their time on four types of activities: managing sellers (32%), managing information (26%), direct customer interaction (23%) and administrative activities (15%). By choosing a holistic approach that includes a territory management solution, sales managers are able to get real-time insights and focus on what really matters – managing their team.
Sales Operations as a Service helps organizations to implement a territory management strategy.
Territory management bears a direct result on sales performance, so investing in a trusted solution will pay off. Homegrown systems are often slow and expensive to change. Third-party solutions already come bundled with APIs, connectors, and services that integrate with the other systems in the organization. If they are agile and intuitive enough, they will help you manage territories in real time.
Before selecting a territory management solution, consider the size and complexity of your sales force, your industry, number of roles, sales ops structure and know-how, etc. Experts advise to also analyze your infrastructure and the scale of corporate growth.
Territory management solutions that include modeling capabilities are especially good for large companies and for those dealing with high volatility and changing regulations. By modeling different territory scenarios with multiple variables, sales leaders are able to make more accurate decisions and reduce risks.
At Optymyze, we go beyond the “lift and drop” approach to territory management. We recently introduced an enhanced territory management application as part of the Optymyze Sales Org Cloud solution, which allows sales ops to visualize sales performance on an interactive map. Users can apply filters to the data and easily optimize territory design.
Sales operations can add an unlimited number of layers to the map. Reps also get their share of relevant info – from the number of transactions and the potential of an account to attainment, quota, and YoY metrics. Optymyze can help clients implement a territory management strategy that is efficient for the next 3-5 years.