Should SDRs report into Sales or Marketing?
One of the strategic decisions an organization must make is determining where sales development will report. It’s an important question with significant repercussions for the success of the SDR team.
Reporting into Sales vs Marketing
In our 2016 Sales Development Benchmark Report, our research revealed that 64% of sales development teams report into sales. The same research revealed that in larger enterprise operations, more than half of SDR teams report into marketing. However, it also revealed that top-performing SDR teams perform more or less the same when reporting to marketing vs. reporting to sales.
The SDR function is largely measured on numbers and results, which makes this a particularly challenging topic, because of its qualitative nature. That qualitative nature focuses much more on how to build an environment, led by dedicated and attentive management, that can provide high quality results.
When we work with clients to determine which organization the SDR team should live under, we evaluate two primary factors: strategic execution of the sales development function and professional development of SDRs. The list below represents key considerations for deciding which organization has the capacity to address these needs for the success of sales development.
- Go-to-market strategy: What is the GTM strategy for accounts? Is there an account-based strategy that needs close coordination with marketing campaigns?
- Qualification strategy: Who has the expertise to create a solid lead qualification strategy for the SDRs, and revise quarterly as needed?
- Process and SLAs: Which team takes the reigns when it comes to making sure process and SLAs are created and managed proactively?
- Lead Management: Which team has the bandwidth and organization to work on setting and adjusting mixture of leads to SDR team and can respond to SDR feedback?
- Change management: Companies change their goals on a quarterly and yearly basis – which organization will allow for better trickle down change implementation to realign against those changes?
- Dedicated manager: Who has the budget to hire a full time SDR manager, and the time to nurture that individual to manage a team of relatively inexperienced reps to quota?
- Coaching and mentoring: Which organization has the expertise and the time to work with the SDRs on sales skills, product knowledge, and execution strategies?
- Peer Mentoring: Which organization is going to foster better working relationships between Account Execs and SDRs? Who can ensure that Account Execs are providing key feedback and learnings to their SDRs?
- Growth Path: Which organization does a better job of helping to decide the tipping point for when an SDR is ready to be converted to Account Exec or if there are stretch assignments they can take on in-org to expand skills into other marketable functions?
- Influence: Which team has the strongest influence on getting the resources the SDRs need to be successful (e.g. product training, buyer persona development, etc.)?
Though the data shows that currently the majority of sales development teams report into sales and that has been true for the last 4-5 years. However, as organizations gravitate to Account-Based Everything and the orchestration of marketing campaigns with SDR outreach, we are watching closely to see if more sales development teams shift to marketing ownership.
The most important takeaway is that regardless of who owns sales development, the leaders of that organization must ensure that sales development gets attentive oversight to maximize the team’s success.
About the Author: Kristina McMillan, Director of Research, TOPO
Kristina has spent over 10 years helping organizations build and accelerate their Sales Development efforts. As a consultant, she developed the sales development programs for successful SaaS companies such Taleo, Eloqua, and Coupa, along with many others, and ran Sales Development for Five9 (IPO 2014). At TOPO, Kristina manages the research organization behind all of TOPO’s practices. She works with TOPO’s analysts to develop best practice frameworks and actionable research that help clients cultivate world-class demand generation, sales development, and sales organizations.