Companies should, and can, implement a sustainable, consistent telephone prospecting program to develop a "sales territory" using an approach that sales reps will actually adopt.

If telephone prospecting controls your destiny, you should investigate a better way to control your telephone prospecting, starting with a strategy for territory development.

To determine whether this article has any value for you, answer these questions about your current territory development program:

• Is most of the prospecting history for a territory lost when the current sales rep leaves the territory?
• Do opportunities that are in play get lost when reps leave? (e.g., "Call me back next month...")
• Do new sales reps spend their first days in the territory cobbling together a list to call from scratch or from electronic or paper remnants?
• Do new sales reps waste time calling companies that previous reps had already called and correctly labeled as not qualified?
• Do new reps call customers by mistake?
• Do new reps know whether another rep is calling the same company—or, worse, calling the same person in a company?

If you answered yes to just one of these, you have room to improve your territory development approach. If you answered yes to more than one, you have a mess on your hands.

The end result of a more strategic approach, as discussed here, might just be a territory development program that will pay dividends in the long run.

The challenge is to design a territory development plan that does three things:

1. Has the right amount of targets based on the effort the sales rep is expected to apply towards generating new customers from it.
2. Will, over time, become a list of only qualified targets.
3. The database of targets is centrally controlled by management.

Goal 1: The Right Amount of Targets

The simple answer to this question is this: The number of targets a rep can pursue in a year. No more, no less.

As a practical matter, the coin of the realm when using the telephone to prospect a territory is a dial. There are only so many dials that a rep can do each year (even though many sales managers believe otherwise) and the use of those dials will determine the number of targets (aka Territory Size) that a sales rep can handle.

An extreme illustration of this issue: If a rep could make 5,000 dials a year, the territory should have somewhere between 5,000 names that they will call only once... and one name they will call 5,000 times.

So, the question is how to determine "somewhere in between." The answer is arithmetic: Six numbers will illuminate this issue (click here to download the calculator (Excel file) used in this article):

1. The first number is how many minutes a day the sales rep commits to prospecting. In our sample calculator, we will start with a commitment of one hour per day. A better goal, however, is to commit to the pursuit of a specific number of targets. Time commitment is good, but number of pursuit steps per week is better. (Most pursuit steps are dials.)
2. Next, let's determine the average number of calls they will make in our ideal pursuit of a single target (before we recycle them for another pursuit later in the year.) Typically, the maximum number of times to call is determined by "the point of diminishing return," or the point at which it makes more sense to call someone new than to call this target one more time. The average number of calls is usually less than the maximum, since you do reach some people, plus you find our on the first call that some targets that are out of business. In our example, we call four times, maximum, but the average is 2.5.
3. The next number is the average time spent in the pursuit of one target. This is the number that sales managers get wrong most often. In a given hour on the phone, other than dialing the phone and leaving a voicemail (or having a conversation), a sales rep is often required to do other things before making another call, such as recording what happened, setting the time for the next call, sending an email, putting the record away, getting the next one, reviewing its history... paperwork, mostly.
   
   In our example, we will use an number from our observation of telephone prospectors: six minutes, on average, per target.
4. Now, an easy one, how many days a year does our sales rep have available to make calls? We would exclude vacation days, the days spent at quota club, and company holidays. In our example, we expect 220 days of telephone prospecting.
5. Now, how often per year do we want to pursue a target? For some markets, it is smart to call every quarter; for others, once a year is frequent enough. Every product and market is different, but you must have a best practice that defines frequency. We will use twice a year.
6. Finally, how good is your list? Our final number is the percentage of names that need to be replaced from the sales rep's starting list. In the ideal list, there would be no company out of business and no company that does not fit the profile of a perfect customer. (That list is actually a goal of territory development, which is covered next.)
   
   Count on replacing a certain percentage of targets as the year progresses. We assume one out of four names will be replaced.

The most common reaction to the calculations is "that's not a lot of targets." Our response: The math is the math, so select the targets for the sales rep with great care.