The Two Class "Divide" for Indian Companies
At some point, > 80% of your company is Sales & Ops - different mindset, motivation & monetary incentives as compared to your original Tech heavy Org. Now, what?
Labor market dynamics in India are such that the SDE - I (entry level software developer) salary is approximately equivalent to a Sales / Ops Manager with 8+ years of experience managing 10-30 Reps…
You’ll find enough literature online to explain how opportunity cost (foreign recruitment of Indian developers) and low gross margin plus excess labor supply (resulting in low Sales payouts) cause such a dynamic in India - but I won’t focus on this.
Instead - I’ll focus on WHAT YOU (as Founder/CEO) can and cannot do about this two class “divide” - which I see at most Ops/Sales led businesses in India.
Let’s start by understanding the divide via the below creative. You can click on the creative & save it for future use.
Let’s break this down into 3 parts:
What you cannot (“might not”) change
What you can change
What should you aspire to do?
What you cannot change..
Targets driven approach to Sales & Ops
Unfortunately, these People functions do rely on setting aggressive (but achievable) targets to drive outcomes
There will be some internal competitive dynamics (investigate from time to time so that this doesn’t become toxic) - vying for promotions, grouping etc
Also, a lack of quota might scare away every hire because without a quota - you can’t define variable incentives (the lifeblood of such roles)
Material changes to compensation structures
At < ₹30,000 CTC per month, it is hard to justify > ₹1,000 in monthly legal & other costs to offer ESOPs to frontline staff (solution to this provided later)
Sales & Ops are the biggest COGS (Cost of Goods Sold) lever so even small shifts (i.e. ₹25K to ₹30K CTC) can break an entire company’s financial model
You can try to ladder variable compensation e.g. 60% - own performance, 20% - team performance and 20% - company performance. But, I’ve never been able to get this to work (revolt on ground)
Attrition related challenges
Absenteeism and churn is a major problem (written about it here) for reasons often outside your control (yes, some Reps might hop jobs for an extra ₹1,000 per month - but that’s a small minority of cases)
Reasons I’ve heard include harvest season in the village, marriage proposals which require going home, or ill-health of immediate family (life is indeed hard).
What you can change!
Sales & Ops mindset
The usual mindset is “need to work here to pay my bills”
But, IF you (as CEO) spend at least one day a week out in the field with frontline staff - you can make them believe they are part of something bigger & that their work is valued.
The mindset shift you want is “I need to come to work because of {company mission} and to earn”; create a shared purpose
Make work fun
Sales & Ops can be daily drudgery - doing the same call opening, answering the same customer objections or doing same routine tasks.
It won’t cost your company much to have monthly sponsored lunches or dinners / other planned outings.
What else can you do? Use your creativity!
Bridging the gap via offline events
The Japanese concept of Genchi Genbutsu (現地現物) "real location, real thing” is supremely useful
Get all your staff out into the field with frontline Sales/Ops - at least once per quarter; at most once per week (for certain PMs)
Frontline staff look forward to such visits - and you’ll be amazed by the depth of product feedback you get from them.
What should you aspire to do?
Treat Sales & Ops as equals (even if off roll)
The way I explain this is: Please say “Abhinav K. has achieved target” versus “Agent 163 has achieved target”
Something as simple as forcing Engineering to overwrite numerical login credentials with actual agent names makes a big difference.
Share company success proceeds with Sales & Ops
Usually, if there is a major transaction - ESOP holders get secondary sale opportunities or one time cash bonuses.
We have done this once - ₹ {Y} for each 1 month of continuous service above a tenure of 3 months; 25 eligible Sales candidates - material sum of money!
You can approach this like a “shadow” ESOP plan for your off-roll Sales staff (once they know its happened once - they trust it will happen again)
Prevent Sales / Ops leadership from intermediating interactions with frontline staff
If your VP Sales can contact any Engineer on Slack - why can’t your Designer be part of a WhatsApp group where updates are shared with Sales?
By breaking these barriers down - you make the frontline staff feel like a key part of decision making - because your PMs & Designers will run product decisions through frontline staff - often yielding different insights than speaking with a VP.
Closing thoughts
At some point in your company building journey, Sales & Ops will be the largest headcount in your Org. We started with 5/0 (Tech/Ops) in October ‘20 and we are 15/70 (Tech/Ops) today..
Hopefully, this post shared some insights into how you can bridge the two class gap that usually emerge at Indian “Tech Enabled” companies
Thoughts, comments & feedback are welcome!