This guide will show you how to design a sound sales structure that will bring you wildly great revenue results for years to come. We’ll cover what makes up a sales structure and its different modalities.
You probably know how important your sales team is…
But have you ever thought about the importance of the internal structure of your sales team?
Understanding and applying sales organization structures, can transform the way your team sells and your whole sales cycle.
You’ll start to view your sales team as a holistic sales system, and you’ll understand how the different parts affect the whole.
But here’s the big deal:
Mapping out your organizational sales structure will help you close more deals and scale for the future.
In this article, you’ll learn:
- What Does a Sales Team Do?
- What is a Sales Organization Structure and Why is It Important?
- How Do You Structure a Sales Team?
- Understanding the Sales Organization Chart
- Applying Your Knowledge of Sales Structures to Your Team
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What Does A Sales Team Do?
Before you learn the depths of a sales organization structure, you must first understand the team.
A sales team is a group of people trained, guided, and paid to sell a product or service to a customer.
Some sales teams are in-person, like retail sales and door-to-door. Others are over the phone and the internet, like some consultant companies and service providers. (Also known as outside or inside sales.)
Sales teams vary in size, purpose, and industry — but generally they follow a particular route to closing a customer called:
A Sales Cycle.
A goal of a sales team is to meet revenue numbers and make more money for the company, which makes them very valuable.
However, it doesn’t stop there…
Sales teams need structure to be successful.
Think about this:
Why are there stoplights and street signs on the road?
Although there are many great drivers out there — and I’m sure you’re one of them — these signs provide structure to prevent as many accidents as possible.
This is the same deal with sales teams.
How?
You could have elite-level reps, but if they’re not put in positions to excel, there won’t be growth.
But the next question is:
What is a Sales Organization Structure and Why is it Important?
A sales organization structure is a way of organizing your sales team into categories and hierarchies that represent responsibilities relative to each other.
They’re really the building block to scalability, more revenue, and long-term team success.
Here’s what you can gain from a sales organization structure:
- Better employee & rep performance
- Better communication
- Less employee conflict
- Less confusion of roles
- More predictability
- A more knowledgeable team
- Smoother sales cycles
With all these great benefits, there are still many different ways of organizing your team.
Not all structures are made the same, and there are three common types that the best companies utilize.
So let’s get into:
How Do You Structure A Sales Team?
You should structure your team based on specializations, knowledge, needed roles, budget, employee compatibility, and market demand.
You don’t want to put people in certain positions randomly. Be strategic about why you’re hiring for a particular role.
On the other end:
If you’re applying for a sales role, be aware of why you want the position and what value you hope to bring to the company.
Understanding these core elements can help prevent you from over-hiring, under-hiring, under-training, and losing qualified leads.
Now with that out of the way…
Here are the three common structures and additional ways to divide your team beyond these.
The 3 Common Sales Organization Structures
The Island Model
Not literally an island…but kind of like one.
In this model, salespeople engages the leads from the outbound stage to the closing stage.
You’ve probably seen this sales structure model in car sales, agencies, insurance, etc.
What’s great about The Island Model is that the customer builds familiarity and trust with the salesperson.
Trustworthiness (47%) and responsiveness (44%) are the two most essential characteristics buyers look for in a sales professional.
Also, due to the consistency, the salesperson gathers plenty of usable knowledge about the customer.
The best part?
Valuable prospect data is less likely to be lost in translation between team members.
Here’s another great thing about The Island Model:
If you’re a sales leader, the island model brings an air of competition for reps because they need to close the client every step of the way.
There’s a higher level of versatility required.
Unlike other models, your reps have to depend on themselves to perform well and reach quotas.
Limitations of this structure: A limitation of The Island Model is the degree of training.
Of course, make sure your reps are trained because if not, they may lose many closable opportunities.
Another limitation is account & prospect overloading.
Sales leaders should make sure reps aren’t getting overworked with accounts because it could lead to lower quality selling and lack-luster customer service.
86% of buyers say they’re willing to pay more for a product if they offer a great customer experience.
The Assembly Line Model
With a name like this, you might guess where this is going.
The Assembly Line model is about sales job titles and specialized roles.
Prospects get moved to specialized reps to get them to the end of the sales cycle.
You likely see this model in retail sales, tech stores, and banks. Customers are “passed along” to people that handle the next step.
Businesses use this as an opportunity to upsell and ask customers about their experience so far.
The Assembly Line Model’s great thing is that sales reps are specialized, so leads view them as true experts — making the sale easier.
Limitations of this structure: The truth is, your prospects are having multiple conversations with different people; thus, the familiarity may not be there much.
At the same time, you could rely on brand recognition as a way of building trust — but not everybody can do that.
Ideally, a shorter sales process would benefit from this model because longer ones could lead to customer confusion.
So, in a nutshell:
Your sales model must be polished because of the many different people the prospect is speaking with.
Ensure every one of your sales representatives is trained well on sales expectations and there’s a method of keeping track of performance.
The Pod Model
Here we’re looking at an excellent fusion of The Island and The Assembly Line.
You can think of this model as the newborn child of the two previous models. (But still very powerful)
The Podmodel is when groups of sales team members play similar or different roles in selling to a prospect from A-Z.
The Pod is seen a lot in enterprise businesses with long sales cycles.
Smaller B2B businesses as well! B2B companies typically have many things to discuss, which requires multiple sales reps to be present during meetings.
Let’s say there’s a pod consisting of a sales development rep (the outbound prospector), an account manager, and a customer success manager.
This is a pod of three that is responsible for guiding the account to a close…
Not only that but also managing the client relationship.
The cool thing about The Pod is that reps can coach each other more closely than if they were to practice traditional sales role-play.
Also, a specialized version of a pod can be very effective in closing because team members build terrific chemistry.
Limitations of this structure: There has to be a method of segmenting each salesperson’s performance, especially if a pod is doing similar roles.
The reason for this is because it’s easier for a salesperson to get complacent in The Pod model if there’s not a measurable way of reading their performance.
Look into a robust CRM like VipeCloud’s sales CRM to keep track of sales team performance to avoid this issue.
A CRM like this will help your team stay organized while tracking valuable data.
More Dynamic Ways Of Dividing Your Sales Team
We just spoke about the three simple sales structures you can implement into your organization.
But now, believe it or not, there’s an even deeper way of structuring your team.
Let’s hop into them:
Geographical Sales Team Structure
Whether an Island, Assembly Line, or Pod, your sales team can sell geographically.
In a Geographical Sales Team Structure, salespeople are assigned specific territories in which to sell.
For example, 5 Door-to-Door Salespeople selling to a neighborhood in Phoenix, Arizona (Geographical-Pod Sales).
Another example would be one salesperson cold calling business owners on the west coast and another rep cold calling the east coast about a sales coaching program (Geographical-Island sales).
An upside is that sales reps using this model get familiar with the people of an area, and your sales efforts are concentrated.
It spells considerable revenue for your business if the geographical area has high income and interested buyers.
And it’s a great way to make sure your sales reps aren’t reaching out to the same leads.
What’s the downside?
Geographical selling can be limited in its number of people.
If your company uses this model, it’s ideal to have your team covering multiple geographies in regions that you service.
Product and Service Line
This is when a company bases its sales team around a specific product rather than a broad array of products/services.
This specific sales team specializes in one product and not a different product within the company.
Again, quite awesome for specialization, so training is critical.
Customer and Account Structure
This is when a sales team works on an account based on size and customer compatibility.
For example, a marketing agency that helps Chiropractors rank higher in SEO. This marketing agency is selling a specific service for a particular kind of customer.
This organizational structure is solid for sales teams being viewed as experts; however, outbound sales reps may need to generate lots of leads due to the niche-specific service.
Industry and Vertical Sales Organizational Structure
Different industries are usually using the same products and services in different ways.
So make sure your sales reps understand how to position your offering to people in different industries.
For this, you’ll need to structure your sales team accordingly.
Understanding The Sales Organization Chart
So we now have an understanding of sales team organizational structures.
But that’s just in theory.
Let’s now move into slightly more practicality — a more visual representation of sales structures.
Great businesses visually represent their sales structure clearly and understandably to every team member.
This is known as the Sales Organization Chart.
This chart outlines the hierarchy, roles, and responsibilities of each member of your sales organization.
It’s really the Sales structure in a visual format.
The chart includes but is not limited to:
- Employee name
- Employee job title/role
- Employee contact information
- Geographical/Office location
- Hierarchy of everyone
This chart outlines different team tasks making it that golden ticket to a well-performing sales operation.
On top of that:
The Sales Organizational chart helps higher-ups understand their sales workflow and adjust their sales cycle as needed.
This chart should change as new roles are being filled in your organization.
It’s always good to have the structure of your business mapped out to streamline your business for scaling.
A Takeaway Of Sales Structures & Its Application
Sales organization structures are all about providing a backbone for your sales team. There needs to be a system that keeps everyone on track and helps them grow.
Utilize the three basic sales organization structures for your sales team:
- The Island
- The Assembly Line
- The Pod
All of this is really to help you make the right decisions at the end of the day.
With the right decisions come the right things for your team to execute on.
Sales Teams can execute well on their structure when they use helpful tools like VipeCloud’s Sales CRM.
Did you know 61% of sales high-performers report using a CRM to automate parts of their sales process?
It’s time you join that 61%!
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Sales Organization Structure FAQ
What are sales organizations?
The aim of a sales organization is to sell and distribute products and services. It depicts the purchasing unit as a legitimate entity. For instance, it’s in charge of various rights of recourse and product guarantees. The market can also be subdivided regionally with the use of sales groups.
What are the main types of sales organizational structures?
There are three main types of sales organization structure – The Island, The Assembly Line, and The Pod.
What is an effective sales organization structure?
Regardless of the sales organization structure, your business chooses to use, strong sales leadership is essential. The finest sales executives build a culture of discipline, responsibility, and transparency that penetrates the sales force and focuses on essential activities known to support the company’s strategic growth ambitions.
Why is sales organization important?
Sales organizations lead sales teams to effective sales planning and policies. All sales operations are controlled by the methodical implementation of plans, policies, and programs of a sales organization. As a result, it guarantees optimal effectiveness and profitability without compromising customer happiness or service.