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Who should have sales responsibility when two business units sell to the same customer?

Article originally published in the American City Business Journals on January 3, 2022.

Companies can be organized in two ways. Those with a single line of business are functionally led by a CEO responsible for creating a cohesive team which is critical to the company’s success.

Companies in multiple lines of business are organized by business units led by general managers responsible for creating a cohesive team which is critical to the success of their business unit.

Because each business unit typically sells to different markets, each unit has its own sales function staffed by sales executives with deep product and end-use market expertise to serve that market’s customers.

When different business units within the same company sell their products to the same customer, should a sales executive from each unit call on the customer? Or should only one sales executive representing both units be the face of the company to that customer?

Many customers prefer to deal with one sales executive representing all the products they purchase from the company, even though that individual may lack expertise in other business unit’s products.

Business unit general managers prefer to have a sales executive from their own team call on their customers. They want to ensure that the sales executive has a feeling of ownership in the financial results of their business unit.

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At my company, we faced this issue with our largest customer, who represented a significant portion of the company’s revenues. We opted to have a sales executive from each business unit call on the customer. The alternative would have been to have a sales executive from the business unit doing the most business with the customer represent both units.

Our organizational culture played a significant role in the decision. Within our company, we held our business unit general managers fully responsible for the profitability of their businesses. They wanted the ability to choose their own team members, build unity and nurture in members of their team a feeling of ownership in the results of that business. This outweighed having a sales executive from another business unit call on the customer. This was especially important since both units did significant business with the customer.

How did we address customer’s concerns about dealing with two sales executives from different business units? In my position of chief operating officer, I developed a deep relationship with the customer’s senior leadership team to resolve any issues that involved products sold by either business unit. The customer liked having the ear of the COO.

My relationship with the customer’s senior leadership team helped significantly when we faced a competitive situation from another supplier and we were able to maintain the business.

Would the alternative of having a single sales executive call on the customer been successful? Of course, as long as that sales executive felt ownership in the success of both business units. When serving a customer, the objective should always be to provide a great customer experience. Either alternative can accomplish this objective.

Stan Silverman is founder and CEO of Silverman Leadership and author of “Be Different! The Key to Business and Career Success.” He is also a speaker, advisor and widely read nationally syndicated columnist on leadership, entrepreneurship and corporate governance. He can be reached at Stan@SilvermanLeadership.com.

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