Many organizations take an informal approach to defining their sales training requirements—they either don't develop any, or do so with a minimal effort. The typical "requirements" effort is reviewing "word of mouth" references, searching the web for training companies that serve the enterprise's market, or responding to a training company's marketing campaign. Countless companies have invested millions in these informal approaches, leaving them with a confused or demoralized sales force, lost business opportunity, and a training budget spent with little to no measurable return.
A Look at Costs
A training event for fifty sales people can cost an organization almost $109,000. For companies in many industries, two sales training events per year are required for their people to stay competitive. If you gather your sales people twice per year for sales training, that is a nearly quarter of a million dollar investment. For a company that, for example, generates $30 million in sales and $4.5 million in earnings, two training events per year represent an incredible 4.8 percent of annual earnings!
Where else in the organization can your spend 1 percent of revenue or 4.8 percent of earnings without a business plan outlining the requirements and benefits, an action plan to track results, and some type of RFP with performance criteria issued to competing vendors? A twice annual sales training event approaches the total information technology (IT) cost for a typical midsize manufacturing company. In this example, from the chief financial officer's (CFO) perspective, sales training is a material income statement expense.
Sales training is an investment, with the expected return being an increase in the average sales per sales representative. The goal of developing training requirements is to maximize the probability of achieving the expected return.
What Is a "Requirement"?
When discussing a requirements definition, the first thing we should do is define a requirement. A requirement is a characteristic of the training, such as the language in which the training materials are written and delivered, or the background of the facilitator (including details such as whether that facilitator was a sales person in the past, or has knowledge of your industry). Your organization must define those requirements that are appropriate to your business situation.
Once you have "selected" the requirements for your particular training engagement, you must define the desired characteristics for those requirements. For example, the Training Materials Language requirement, may be characterized by English and Spanish. You can then present this to an ESP in an RFP and evaluate their characteristics against those of the requirements you've defined (see figure 1).
