MANAGING SALES PERFORMANCE: IT’S EASY WHEN YOU HAVE A PLAN

Our discussion today has one focus: helping you create and execute a plan to manage sales performance.

When expectations are created, communicated and monitored – managing performance is simple. Selling PEO is hard, let’s make managing performance easy and most importantly – effective by establishing a sales culture of accountability and performance.

Over the years, the question that I have been asked the most is “What should my sales team’s production/numbers/expectations be?” The answer is always the same;’ “No idea.” This is not a cookie cutter process, there are a number of factors to consider.

FACTORS TO CONSIDER WHEN DEVELOPING REALISTIC EXPECTATIONS

When developing realistic expectations, a number of factors come into consideration. These are just a few:

1. What is the effectiveness of the recruitment and selection process?
2. What is the tenure of the sales team (how many new team members and how many experienced team members)?
3. What training does the company conduct for sales team members, especially new, inexperienced team members?
4. What is the ramp up time for new team members?
5. What is the sales leadership/management style?
6. What is the company’s marketing plan?
7. How does the company generate sales opportunities/leads for the team?
8. Do or should expectations vary by quarter?

5 RECOMMENDATIONS FOR MANAGING PERFORMANCE

One: Minimum Expectations Should Be Set and Clearly Communicated

Let’s establish the vocabulary first. I recommend using the word “expectations” as opposed to budget or quota – I hate the word quota.

Goals should be developed by each sales team member, but expectations…well are exactly that…what is expected of a sales team member. Consider establishing minimum expectations for measurement. Meeting minimum expectations means you get to keep your job. When sales team members exceed minimum expectations, they earn bonuses. More on bonuses shortly.

Specific expectations should be set for new client sales, revenue or fee income, number of meetings with clients; proposal (closing), discovery, gaining documents for proposals, client care, prospecting calls and training.

When establishing expectations, take into consideration the experience and the tenure of the sales team members. Expectations for the first year would obviously be much less than expectations for the third year.

When recruiting new sales team members, be sure to communicate the expectations by which they are going to be measured. Then communicate expectations upon hire by requiring new sales team members to sign an expectations agreement.

Lastly, it is imperative that you have rock-solid onboarding and training for new sales team members. More importantly, if a new team member deviates from the training plan – quickly course correct and remind them of the expectation. Establishing a firm, but fair approach from the outset will save you a lot of future issues.

Two: Establish Rewards and Consequences

When minimum revenue expectations are established as the performance baseline, managing performance is much easier. When sales team members exceed the minimum quarterly revenue expectation by at least 10% they should earn a bonus. When they exceed it by 20% a larger bonus, when they exceed by 30% a larger bonus and so on.

When sales team members meet minimum expectations, they get to keep their job.

Let’s face it, you are going to have sales team members who don’t meet minimum expectations. Failure to meet minimum expectations in a quarter should automatically trigger a performance improvement plan. Failure to meet minimum expectations two quarters in a row, likely triggers the “short conversation.”

Three: Sales Team Members Should Know Where They Stand

You want a sales culture of accountability and performance. Regardless of the technology or method you use to track results, every salesperson should know where they stand in meeting expectations, week by week, month by month, quarter by quarter. Don’t wait for a quarterly or an annual review; you must monitor sales performance and activity weekly.

Four: Schedule Meeting Dates for Conducting Performance Reviews

Weekly or bi-weekly one-on-one meetings with each of your sales team members are a must.

Monday is the least productive sales day; no one wants to see a salesperson first thing on Monday morning. We don’t have 40 selling hours in a week, so don’t waste productive sales time for meetings on other days of the week. Kicking off the week with sales meetings and one-on-one meetings gets your team ready and motivated for the week.

Weekly or bi-weekly one-on-one meetings should never last more than 20 minutes. Your sales team members should be well prepared to discuss their sales results, expectations and pipeline.

Quarterly performance appraisals should be scheduled for the entire year, the second Wednesday following the end of a quarter. The second Wednesday is plenty of time for you and members of your team to prepare for a quarterly review. Quarterly reviews don’t need to be long either, 30 minutes is sufficient.

Five: Sales Team Members Should Present Their Performance

Whether it is a weekly discussion, a formal quarterly or annual performance review, sales team members should “present” what they accomplished along with other activity. Weekly discussions may focus more on the daily activities and results for the previous week.

Each quarter require each sales team member to put together a short presentation in the following format.

First, the presentation begins with one of the following statements:

• I met minimum expectations, and I commit to do doing the following in order to reach a bonus next quarter.
• I exceeded minimum expectations by X% and I earned a bonus of $X.
• I did not meet minimum expectations by X%.

Second, the team member should review their pipeline and the probability of gaining clients in the pipeline.

Third, the team member should list specific commitments and activities of what they will do to improve their performance in the next quarter.

Implement these recommendations and you will create a culture of accountability and managing sales performance will be much easier.