Excellent issue to evaluate. I have seen both models be wildly successful - and here is what it took in each case. 
 
 
 
Centralized team:  
 
In order for a centralized team to benefit from being in one location, the culture needs to thrive on being "a real-time team". This means, taking advantage of mentoring, developing best practices based on physical observations of one another, frequent impromptu meetings to discuss what works/what doesn't, working closely with constituents in other departments (getting IT support as needed), etc. There is no point to being centralized if people are going to behave like independent contractors with different goals. I've seen this work well for less seasoned folks who may not be self-motivated, or highly experienced in the field. 
 
 
 
Remote teams can be wildly successful if the team is comprised of natural born communicators. In this scenario, a conference call with folks who are dispersed worldwide, can "feel like they are right next door". When they do get together, it's like they were never apart. They are highly motivated, disciplined people, who enjoy touching base, but do not need to be in each other's presence to optimize their performance each day. In my experience, they tend to be more seasoned, and have considerable relevant experience. Each of them performs like they are running their own company each day - it's just part of a larger company. It also takes greater leadership involvement to keep this team on the same page at all times. 
 
 
 
As far as tools. It can be helpful if leadership can monitor both phone calls and computer screens randomly, as well as keeping call records. This works well for either central or remote teams. Metrics are always important to track in order to understand and maintain performance goals.  
 
 
 
Contributors are not only comfortable with tracking - they want to know the metrics, so they can assume a leadership position on the team. 
 
 
 
Best of luck - let us know what you find. 
 
Kathy 
 

To make an effective recommendation, I would need some additional information 
 
1. How is the company doing compared to the financial plan? Is the sales organization DOES NOT MEET/ MEET / EXCEED current sales metrics? 
 
2. How long has the inside sales reps been in place. Are they new folks just ramping or experienced in deliverying the lines.  
 
3. Is the product new or mature? Is this a time of fast moving change or is it business as usual? 
 
4. Would there be intangible benefits of getting the team together in the same room to create shared mission & espirit de corp? 
 
5. Are their critical flaws in the process today? 
 
 
 
My rule of thumb is that if it is working today and you are looking for an incremental increase, then you should quiery management, managers & the sales organization for opinions and ideas. If the organization is not hitting their numbers, then I would look to change it up and its always easier to do that with everyone in the same room, when you can see reactions and facilitate interactions.

I agree with Kathy’s comments and Dan brings up some very good questions.. 
 
In general, I think a centralized model works better for most “traditional” Inside Sales teams- specifically, when they are sitting together in the same area, in close proximity to the sales management team and other pertinent resources.  
 
When everyone is on the phone and sales are closing, there is an energy that builds- which can be very motivating for the staff. Reps can overhear and/or shadow each other- and quickly pick up what works and what doesn’t. Managers are available to answer questions, provide encouragement and give feedback on the fly. 
 
In a centralized model, Reps will have a better view of the entire organization and feel “in on things” happening in other departments. Communication will be faster and clearer. 
 
However, I have seen a work at home or decentralized model work when the Sales Reps are very experienced, have a consistent track record of meeting/exceeding quota and have been with the company for a long time. And, the management team is equipped with the proper technology to monitor their performance “real time”. 
 
If I were asked to review this, I would build an excel model that illustrates the current metrics (e.g. calls, contact rate, opportunities, sales, achievement of quota, costs, costs per sale) and then guesstimate the impact of centralization on each of my metrics. And, run “what if” scenarios to see how the outcomes change. 
 
Good luck!! 
 
Marci Reynolds 
The Sales Operations Blog 

First off, when I worked for a publishing house back a bunch of years ago, I had a similar situation but just smaller scale. We had 50% of our 40 person inside sales team working in the office and the other 20 folks working from home. So after meeting all of the folks and talking to all of them about their roles, their aspirations and how they saw themselves in the organization, I came up with some interesting conclusions. First off the folks at home were much less committed to the goals of the company and I would find out why, later. Secondly, as long as they were making their numbers, they were never really heard from. So after about 90 days of being there, I realized that I needed to dig further into what it was they were really doing. So come to find out that they were faxing in their results each day and were hand documenting calls, contacts and successes. More interestingly, they were having their phone bills paid by the company. So I decided to go through the phone bills to determine exactly what was going on. Needless to say when I found out that 10 of them weren't even making 10 calls a day and were still making or over achieving their number. I ended up firing the 10 thieves and having the other 10 come back to work inside. With some additional training, promotion of my stars into team leader positions with raises and incentives to mentor their charges, we got things back on track. So my advice is to bring back into the fold as many of your team that is practical. Go through all of their reporting mechanisms and go through them with a fine toothed comb. If you get this out of the way now, you are going to save yourself a lot of long term aggravation.

One thought might be to dashboard out the metrics that matter in your sales process. For example: 
-dials 
-connects 
-next steps / referrals / etc. 
-meetings scheduled 
-pipeline generated 
-etc. 
 
Sharing this data out to Snr. Mgmt and the Reps themselves might help to drive behavior. 
 
I am a big fan of having Salesforce.com email activity disposition reports to yourself and the entire team. It becomes glaringly obvious when someone isn't putting in the work. 
 
This can also provide you with a quantitative way to evaluate how Reps are performing whether they be internal or remote.

One of Dan Tyre's co-workers once told me that he was a "machine", but not everybody is a Dan Tyre. Remember that teams are made up of individuals and individuals working remotely need to be self-starting, work without supervision, not make excuses, not resist prospecting and working independently. Many salespeople that succeed in a centralized system fail miserably when lacking the above traits.

I am an outside sales person, based on my customer's perspectives: 
 
1) All of my customers expect and demand a great time response (real time support) 
 
2) Most of my customers expect to have somebody there available when they call or send emails to quickly respond to their requests, or concerns. 
 
3) All expect to get somebody on the phone or email that will resolve their problem or answer their concern. 
 
4) All expect actually get a response at the first encounter with the CSR. 
 
5) Very few requested to have a local CSR person. 
 
In other words it does not really matter if you have a centralized CSR center or a local CSR team as long as you have capable and knowlegable CSR people. 
 
The CSR team could be in Africa as long as when you call they answer their phone and actually resolve your problem.

All of the metrics are important, but not a factor in whether they should be in-house or out-housed. Two of the factors that I would seriously consider are how closely managed they are and are well-suited they are for working remotely. Rick, in his comment above, mentioned some of the attributes we weigh when scoring a salesperson's ability to work remotely without supervision. If the sales manager will closely manage the out-housed reps, it can offset the problems one might encounter when the rep isn't suitable for remote work. If the manager will have more of a hands-off approach, it can offset the strengths of a rep that is suitable for working remotely. In addition, even for a hands-on manager, they must have strengths in the area of accountability and coaching for a remote scenario to work effectively. 
 
I'd bring them in!

So, I agree with portions of all of the posts so far. That said, it is not an easy decision. I think a lot of the decision has to do with the culture of the organization.  
 
 
 
You outlined 4 critical areas to be concerned with. I personally don't feel like productivity or accountability should be different with a centralized or decentralized structure. If for some reason you are expecting more or less from a remote employee, your measures are flawed and I would suggest you reevaluate your management practices. If I have a remote employee who is not performing up to par, I will have a manager bring them into the office, or travel to the remote office, for a couple weeks and job shadow them to determine what the issue is.  
 
 
 
I think the real question that centralized vs decentralized presents is the impact and benefit of team culture and communication. Communication and having your organization set up for a truly decentralized sales organization is one of the most overlooked aspects of this decision. You need to really evaluate how connected your remote folks feel to the organization and how effectively they can navigate and address issues internally and cross functionally. A very simple method of determining this is simply asking them. You really need to observe how they are navigating the organization. Also ask yourself, what is the opinion/image from other departments of our remote sales folks? This will help gage the effectiveness from the other side. If your remote sales people have a poor image internally, they will be less likely to get things done.  
 
 
 
There are a lot of benefits to keeping an inside team together in one location. Particularly if this is a young team, which most inside teams are, they can all really benefit from each other and a team atmosphere. My personal preference with a young team of this size would be to have them all together. That said, If only 30% of the 15 live close enough to come in, then the question will be how quickly can you hire and train in your immediate market, what does the transition look like and how much productivity will you lose during the transition.  
 
 
 
Overall, I don't have enough information to provide a recommendation but would be happy to help talk through the options if you would like! 
 
 
 
best of luck! 
 
 
 
Carl

Thanks to everyone who commented! Mr. X (our newly appointed Director of Inside Sales)has provided more information for you as requested. It follows: 
 
I'm glad you asked.  
 
 
 
- Performance: Not performing well vs. Field peers. Lack of resources and undefined processes have been the primary causes in my opinion. Additionally, I estimate that we've spoken to only 30% of our accounts due to the large territory size and lack of marketing / IT support with respect to efficiency tactics... e-blast/fax-blast/direct mailings. This is a huge opportunity. Stated differently, we are adequately effective yet woefully inefficient.  
 
- Tenure: The team has been in place for 10+ years. Half of the reps came from the field and have and other half would be considered as experienced as our Field reps. However, I get the feeling that the view from the outside (corporate and Field sales) is that this is the 2nd tier sales team... red headed step child.  
 
- Growth: I do plan on growing the group by about 30% to fill current vacancies and decrease their territory sizes. There may be a benefit of bringing new reps into the fold for several months until they earn their wings.  
 
- Products: We focus on 3-4 primary products which have been received very well by the market place (many currently in launch phase). We compete with a few other large manufacturers and are welcomed by virtually all accounts because of our product pipeline. We are the fasting growing company in our segment.  
 
- Process: There are critical flaws in the process today. While our Inside and Field reps are highly motivated, independent, and results driven, I have not been able to find defined processes that are "agreed upon" as best-in-class. We are working on developing a best practices repository that the team will continuously update. I will say that I used to be a Field rep/mgr for this company and have never seen the level of sharing that the IS team displays. They are all willing to help each other.  
 
 
 
With everything that has been posted, I feel that the team structure can stay as it is assuming:  
 
- Develop metrics (currently done monthly) on a more frequent basis and share with the team to highlight rep strengths and weaknesses to drive performance improvement  
 
- Develop the processes to support their sales attainment  
 
- Maintain communication with each other (as is) and with Field reps (opportunity)  
 
- Find technology that can allow me to best monitor metrics on a real-time basis  
 
- Change the perception from the "outside" that this team is a significant overall contributor to the talent pool and sales division  
 
 
 
Based on the additional info above, would anyone's direction be different?  
 
 
 
Thanks!