A Different View of Managing Sales Performance

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Salespeople love having their performance measured; Yeah Right!

Sales people love submitting sales reports. Right on!

Is your sales process measurement a reward system or a punishment system?

The number one motivator for salespeople is making a sale. Just look at their faces when they walk into your office traveling an order or a cheque. They are on a real high at that moment. Then they go on to the next prospect and get a knock-back, then another. The spark dies and the target starts to look unachievable. Turning up to next sales meeting to discuss results starts to look like volunteering for a flagellation session.

So the question is "Does your sales measurement system help your people make more sales?"

The answer depends on whether you are measuring results, the number or value of the orders won, or whether you are measuring achievement of millions on the path to the sale.

The critical issue here is the realization that as a sales manager you can not manage the result. What you can manage is the activity that produces the result. If your people are doing enough of the right things, and doing them well, they will achieve the result. The only way you can manage the result then is to make all the sales yourself.

If you measure progress along the path to the sale, best done at the critical milestones, then you are in a good place when it comes to guiding a salesperson.

An example may help.

One of your salespeople has had a busy week making calls on qualified prospects, and has generated a backlog of requests for quotation. There is not a single sale in his sales report. He is way behind on the quotes, and you know from experience that if they do not go out in two or three days the prospects will cool off. He needs guidance from you.

You have a choice of actions.

1. T ell him to stop everything and get the all the quotes out.

2. Tell him he has had a great week. Well done and stick at it.

3. Ask him why he has not made a sale.

4. Show him how to balance up his sales activity so he moves every prospect along the path to the sale at the desired pace. Help him to prioritize his prospects to get the quotes out progressively.

Set out like this, the answer is obvious, but it is time to be honest. What did you do the last time this happened? What is the likely response to these options?

Answer 1 This ensures that he runs out of steam in a week or two, and wonders what has gone wrong.

Answer 2 He can not make a sale until he quotes.

Answer 3 This focus on the end result is a certain de-motivator.

Answer 4 This is the way to guide him to steady progress and a steady flow of orders.

What you need, to be able to do this, is a system that gives you a sales report on the activity of your sales people and the status of every prospect in the pipeline. Then you can guide them to the activity that will lead to a steady flow of orders. Your sales meeting will become motivational working sessions, rather than de-motivational exhortations to work harder to reach sales targets. Your people will become internally motivated by the certainty of success and their confidence will grow.

If your sales reporting system lists every sales prospect, and the latest milestone in the sales process that has been achieved, you have made a start. If your system assigns a probability value to the present status of each prospect, based on the established relationship between the milestone and the probability of banking the payment, you are way ahead. If your system calculates the expected future value of all the prospects in the pipeline, you know whether they have been working effectively by the change in the expected value, and what they have to do to increase it.

This approach to reporting sales activity and value gets you real information that is hard to fudge. Many sales managers treat sales reports as an advanced form of cheat sheets, with the main question being "How long before the boss finds out?" With a focus on measurable miles, there is nowhere to hide; either the quote has gone out or it has not. With the probability of success assigned by the system, the guesswork about the quality of the prospect's relationship with your business is taken out of the equation. The reliability of the information you receive from your team will skyrocket.

You will transform your relationship with your salespeople from boss to coach. Your sales will be easier to forecast because you have removed the peaks and troughs. Life will be so much more satisfying.