In Sales—We Get What We Pay For

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I talk to a lot of business owners about their sales process and sales teams as part of our planning and performance work and I sometimes hear the complaint that the sales team is not focused on the right things. 

What I have found as a common theme among these organizations regardless of industry, is that in sales, we get what we pay for. 

Determining a comp plan for a sales team can be tricky and there are specialists who can help work out the finer points of a plan.  But it’s helpful to start with the simple question: “what are the most important activities and behaviors you need from your sales team?” 

If you’re only paying commission on new sales, don’t expect your sales people to spend a lot of time servicing existing customers.  If your sales people have a large book of business that produces enough repeat sales to sustain their income, then don’t expect them to go out prospecting for new accounts.  The key is to create alignment between your expectations, the activities you want and the behavior you’re rewarding.

Why Do We Plan?

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Why do we plan?  It’s a simple question, with multiple answers, all of them correct.  We plan because we need a roadmap for where we’re headed and what our preferred future state should look like.  We plan because we need goals—concrete outcomes that we want to achieve.  And we plan because it helps us to create focus around what is important.

All those reasons are valid and correct, but when it comes right down to it, the most important reason we plan, is to change behavior.  Without a plan we’re most likely to continue the behaviors we’re currently exhibiting and that won’t get us to a different outcome!  Lack of behavior change is also why the benefit of most planning exercises is not realized.  Organizations put 90% of their effort into creating the plans and 10% or less of their effort towards changing the behaviors that will be necessary to implement the plan.  Remembering “why we plan” can change the way you organize your next planning session.

Strong Performance Management Requires ‘Soft’ Leadership

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Strong performance management requires soft leadership.  Soft meaning the ability to be empathetic, listen, reflect and ask clarifying questions as in ‘soft skills’ rather than soft meaning squishy or ineffective.  Strong performance management requires more than just intellect and technical knowledge--emotional and social intelligence are what make the difference.

Emotional intelligence is the ability to process emotional informational quickly and accurately, to recognize one’s own emotions as they happen, and to immediately understand their effects on oneself and on others.  Effective performance management is instrumental in insuring that the critical projects in your organization get implemented in a timely basis.  But intelligently using emotion to consistently build relationships and achieve group goals is far more difficult than say, learning how to read a balance sheet or do financial forecasting.  An organization needs to first recognize this fact, and then make a concerted effort to develop and nurture the skill of emotional intelligence in its leaders.

Measurement is Highly Overrated

You may have heard the sentiment that you can only improve what you measure, which I think most people would agree to be true.  But another great axiom is that measuring everything is like measuring nothing.  Organization’s can be guilty of measuring so many things that most employees (other than salespeople) become confused as to which measures are reflective of their performance. 

Clear measures help people move toward a goal, giving them tangible feedback on their performance.  People will focus on what you measure, so it’s important to spend a sufficient amount of time determining what those measures should be and getting the employee’s input and buy-in to those measures. 

The following three qualities are important to consider when defining measures for your business. 

1)      Evaluate the measure to insure it’s evaluating the correct behavior.  Think about the most basic purpose of the process and see if the measure is reflecting that purpose.

2)      Measures that use ratios are generally more meaningful than absolute values and a relative measure provides a more useful comparison over time.

Measures should be reflected as trended data because the meaning is much greater.

Selling Strategically Requires Knowing All the Buying Influences

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Back in 1987 when I was District Systems Manager for a Fortune 100 technology company, I made one of the largest sales of my professional career worth about $500,000 to a bank in St. Louis.  We pulled out all the stops to win the account, including flying the client to our headquarters on the corporate jet (it was the eighties after all and companies still did that). 

The interesting thing about winning that sale was that my primary competitor focused their sales efforts on the executive level at the bank.  While I had created relationships with the executives, I focused the majority of my time defining our proposal/solution to a manager within the end user department of the bank who would be using our system.

As it turned out, upper level management relied more heavily on the recommendation of their internal subject matter expert than they did the outside professionals that had been ‘wooing’ their business. 

That sales experience taught me several valuable lessons about selling: 1) You can never assume you’ve ‘won’ a deal just because you have good relationships with the owner/upper management, 2) Sometimes a technical person who can’t officially say “yes” to your proposal, does in fact have the authority to say “no” and 3) You need to be strategic about how you work with potential clients understanding that in a complex sales cycle, multiple buyers will be involved and will have input into the final decision.