The sales function is among the least diverse functions of the firm. This constitutes a challenge for all sales managers, but also a hidden potential that is just waiting to be unleashed. In this article, we will both describe this challenge and give some advice on how you can unleash the hidden diversity potential of your sales organization.
THE SALES FUNCTION – AMONG THE LEAST DIVERSE
For some reason, the sales profession has been dominated by native men, and continues to be so, despite improved diversity in many other functions of the firm. In Sweden in 2013, only 29% of B2B sales people were women, and only 8% were born outside Sweden (Statistics Sweden). For female sales managers, the share is even lower – only 10%, and that level has remained stable since at least 2002. This can be compared to the share of female managers in privately held companies in general, that was 34% in 2012. This level has also steadily improved from a level of 26% in 2002 (Women’s Business Research Institute).
DIVERSITY – NOT ONLY ABOUT GENDER
Of course, diversity is not only about gender or ethnicity, but should also include other variables, such as age, disability, and sexual orientation. However, although there are public statistics available on a general level, there is a shortage of diversity statistics on the level of professions, for example sales.
THE HIDDEN DIVERSITY POTENTIAL OF YOUR SALES ORGANIZATION
There are many arguments why this situation should change, such as legal and moral. But the most important argument, from a business perspective, is that many things point to the fact that an increased diversity is correlated with an increased business performance in general, and an increased sales performance in specific.
A study from McKinsey & Company (2015) shows that companies that are gender-diverse, are 15% more likely to outperform companies that are not. The same study holds even stronger support for ethnic diversity, where companies that are ethnically diverse, are 35% more likely to outperform companies that are not. Further, a study in Harvard Business Review (2013) shows that companies that are multi-dimensionally diverse (i.e. have high diversity with respect to gender, ethnicity, and sexual orientation), are 45% more likely to grow their market share, and 70% more likely to capture a new market.
Diversity also has positive effects on the performance of the sales organization. Women have, on average, a higher closing ratio than men, why an increased share of women should have an effect on the average closing ratio (DocSend 2016). Further, women, foreigners, and younger people have, on average, a higher growth ambition (Tillväxtverket 2014). ProSales, in turn, have previously showed the importance for sales performance of having a high drive index (which is similar to having a high growth ambition), when it comes to the performance of sales people.
There are many explanations behind this: One is that most companies meet an increased diversity among customers, which needs to be followed by an increased diversity in the firms’ customer interfaces. Another is that an increased diversity leads to improved innovation, which gives competitive advantages in the firms’ products, services, and offerings.
5 STEP FRAMEWORK FOR INCREASED DIVERSITY
To unleash the hidden diversity potential of your sales organization, and to lead and manage this process, it can be helpful to depart from some kind of framework. The Chamber of Commerce and Industry of Southern Sweden (2010) has developed a five-step model, that in a good way summarizes what needs to be done.
Step 1: Create commitment
The management’s decisions and commitment is a prerequisite for this process, and to give the diversity issues legitimacy.
Step 2: Define diversity
Define diversity in general, and diversity management in specific: What is it, according to your firm? And why is it important, according to your firm?
Step 3: Analyze the current situation
How does it look in your firm when it comes to diversity: Where do you have high diversity, where do you perform well? And where do you have low diversity, where do you perform not so well? Download our checklist here (in Swedish).
Step 4: Create strategy
Create a business strategy for diversity. Not just a human resources, marketing, or sales strategy, but a business strategy, that comprehends the whole firm.
Step 5: Measure results
What gets measured gets done. So finally, create key performance indicators for both benefits of and costs for diversity management.
Ph.D. Peter Vaigur, R&D Manager ProSales Institute