The 80/20 Rule and Sales Management: Did Pareto Have it Right?

Yesterday I posed the question: If the 80/20 rule is true (80% of revenue from 20% of your sellers & clients) how should a GSM focus time & energy?

John Maxwell summarizes the concept: "The greatest time management tool I ever learned came from the 19th century economist Vilfredo Pareto. The Pareto Principle (which I quote a LOT) states that if we devote our energy, time, and resources to the top 20% of our priorities, we’ll achieve 80% of the results we desire. Use your time log to clarify which activities are important to you. Then focus your schedule on the top 20%."

From the responses so far, you’ll see some excellent discussion and feedback.  It's not too late for others to weigh in via the comments link below.

One Manager Responded: Managers should spend 80% of their time not only with their highest performers but with the 20% of clients who represent 80% of their revenue.

Another posed the question: Or should sales managers spend time with the 80%, that have promise to move into the 20%?

Another dissents somewhat: The key qualifier is “if the 80/20 rule applies” I would say NO! If 80% of your revenue is coming from 20% of your sellers the greatest upside comes from the 80% who are under performing.

Another: Spend the bulk of your time where the money is. (duh!) Part 2: When working with your sales team, neglect is never a good strategy. Most "top performers" weren't when they began their sales career.  Somebody recognized that they had talent and mentored them so that they could become top performers (think John Wooden).

The best sales managers are those who intuitively know who will respond to a teaching opportunity and when to seize the moment and develop a strategy for success.  This is not measured with a clock, but by the value of the trust developed between the seller and the GSM.

Another affirmed that TRUST comment and said: Sellers respond and mimic the habits of good sales leaders.  You can coach and preach all you want, but if you are not in the field, experiencing the real challenges of the street fights that are taking place out there, learning will be hindered.

Another: I think we should be spending 80% or our time teaching our sellers to apply this rule with their accounts.  Today it is all about growth year-to-year.  Up, down, or flat is the question.  The sellers bringing the least can be the ones that provide the biggest upside in growth with good direction and training. I need to better spend 80% of my time teaching spend 80% of their time working on key and target accounts.

Another: The real key, I believe, is to customize your approach for each seller in order to get the best performance possible from each individual. Coaching should be geared to the individual’s personality, organizational abilities, negotiation skills, presentation talents, etc.