Title: Pointless Targets
Post by: Stephen Taylor on August 22, 2007, 03:46:09 AM
I recall a heated discussion with a sales director some time ago where I proposed that the long-term effect of setting activity targets for salespeople would eventually lead to failure. He vehemently made the point that he had systematically imposed activity targets on his sales force and that the result had been to treble average income per salesperson within 18 months.
What he didn't say, something which I found out when I investigated further was that he had at the same time:
? reduced his sales force from 450 to 300 ? letting the bottom 150 hundred producers go, and
? the average income per salesperson at the time he took over was one quarter of the industry average
There are two types of targets most often associated with selling and sales coaching:
? Financial targets ? results, and
? Activity targets
Given the choice between buying activity management systems and implementing a performance coaching system to bring out the best in salespeople, my unfortunate experience is that many senior management teams will inevitably choose activity management. The reason? It's easy. OK, so you have to push people around a little; you might have to dismiss a few non-achievers; there will tears before bedtime; but it's a relatively easy thing to implement and to control. Yet my firm conviction is that it is easy because it doesn't work. It works in the short term ? granted, and there's even a place for it during field induction and as a mechanism for performers to appraise themselves, but as a coaching tool it is a non-starter.
I believe that you teach salespeople about activity, not tell them about it. If you teach people, by example, that activity is important ?that's quite different from demanding levels of activity. The danger with the latter is that you will have your salespeople deliver the activity without a corresponding increase in business. I have numerous examples of salespeople forging activity levels simply to keep the manager happy. In the meantime the cuckolded manager sinks into a quicksand of statistics trying to work out where it going wrong.
I recently visited an area sales manager who was having problems with a non-performing salesman:
When I entered his (the manager's) office there was a mountain of paper on his desk. He proceeded to tell me about Jack Newton who was under performing and had been doing so for some while. He told me that he had insisted that Jack increase his customer interviews from 8 per week to twenty per week. The manager showed me the charts he had put together showing the pattern of calls and results. When he opened it up it filled the surface of the desk in front of me. It was very impressive. It must have taken him quite some time to put together. Jack was now calling on an average of 21 customers per week. His results had not increased. I arranged to meet Jack, with his manager present and I asked him to bring his. When we met I opened Jack's diary and I pointed to the first name entered on Monday morning. I said ? Jack. If I ring this person up, will he know who you are? Jack looked in pain. Yes of course, he said. I said ? Jack if I ring all of these people up, will they all confirm they know you? Jack paused ? Yes. I said ? Jack. I'm going to ask you one more time, just to save me the trouble of telephoning all of these people, which is what I intend to do, how many of the names in this week of your diary will confirm that they have met you? Jack paused longer than he had before ? most of them he said. But not all of them I said. No he replied. Out of the corner of my eye the manger was sinking into the furnishing of his chair. Jack, I said slowly, this is now really the last time I'm going to ask you, when I ring these people up, how many will confirm that you have been to see them; that you attempted to sell them your service; that they were not a personal friend?
Over a couple of months Jack had falsified 80% of his activity. It wasn't his fault. He was responsible, but it wasn't his entire fault. The manager had forced him to achieve an arbitrary activity target. The manager had abdicated his personal responsibility of spending a few days with Jack showing him that activity mattered but that it isn't the only thing that matters. See more people is too easy a remedy.
There's a distinction between what your role has to be a) with new starters, and b) with experienced salespeople ? whether they are overachieving or not. The principle is that you train and manage people up to the line, and you coach people after the line. Up to the line is where you set your benchmark ? the basic minimum requirement; above the line is where you seek to help people excel at the job. You cannot help people to excel at the job until they reach the line. Below the line are your minimum expectations. The elements which are below the line could include the requirement to learn a sales structure. It could include knowledge levels. It could include procedures. Below the line is where you apply the rules. There is no negotiation below the line. You make it clear what is expected and you implement it. These are the rules which are spelt out at recruitment. You make it clear what will happen when someone starts in your team. You do this before they join the company ? not after. All too often I've met salespeople on an induction training courses where their idea of what the job entailed and reality were miles apart. You make it absolutely clear what you expect them to do, and how you expect them to do it.
You may produce figures which show that from a particular level of activity that a particular financial outcome is being achieved within the sales force. You may produce figures to show that the relationship between activity and income leads you to believe that the more people that you see, the higher the potential results. You may choose to ignore the fact that top salespeople see fewer customers than their lower performing colleagues. But you need to ask yourself the question ? what is it you want from the salesperson? Activity or results? Forget the relationship between activity and performance ? what is you want ? activity or results? If it's results then apply the rationale I have laid out in detail above. If it's activity, then perhaps you have lost the plot. The most important thing to you as a sales manager and a sales coach is results and your job as a coach and a trainer is to improve on performance. Anybody can increase activity. Activity is but a measure of performance. If performance is low one of the elements of increasing it can be increased activity. It is the easiest way in which to increase performance. It involves playing the numbers game.
That's not to say that you can't influence activity ? but it's not coaching, it's training. Part of the central training programme could and should contain basic training on the activities that go towards making up the prospecting part of the sales job. It right to expect that people work hard in return for what you pay them, but that's a philosophy that new people will learn from what they see about them. The greatest influence on that will be you, and the rest of the sales team. The greatest influence on the rest of your sales team is you.
You influence people about activity by making sure that you reinforce the central training by meeting the new starter immediately after the training programme. You job is to check that they have accepted the philosophy of the company (which could include work ethic); that they have acquired whatever level of knowledge was expected (so you test it); and that you check that they have acquired the expected skill level, which means that you test it in role-play. These are three important tests before you allow the salesperson in front of a customer. As a precursor to his you have to be 100% confident that the central training process works and that the format of the central training programme delivers to you exactly what was agreed, otherwise, when someone starts with you in the field and they either don't accept the company's philosophy about work ethics; or haven't acquired the level of knowledge and skill you expected; then you will not be able to decide whether it's the new starter's fault or the central training department's fault. I suggest you sort of all this out long before you start employing salespeople. You and the training department much have complete faith in other's ability to deliver exactly what has been specified. The last part of this phase is that you must accompany the new salesperson on a live customer call. It is the only way in which to ensure the transfer of theory from the recruitment stage and the training of basic training on the central programme to where it really counts and that's in front of the customer. There isn't a professional coach alive that doesn't sit on the touchline; stand in the wings; sit in the auditorium; watch the actual performance as part of their coaching responsibilities. There's nothing you can do about the performance, except learn.
It's important to give the performer emotional strength through your support and your expectation of success. You need to transfer your positive expectations about the potential of the performer to them ? I know that you can performer higher. I know that you can be even more successful. But be careful about expectations that are too high too quick. One step at a time is enough.
Frank Salisbury is a highly experience motivational speaker, and inspiring business coach, particularly to the sales profession. Frank is recognised as a leading authority in the field of sales - including sales process design, sales performance, and sales coaching.
He strongly believes that whether we work in the public or private sector; whether our organisation is commercial or non-commercial; that we are all in sales. His favourite quote, which has become his maxim, is from Robert Louis Stevenson ? 'Everything in live is selling'. He has spoken at numerous conferences and seminars where his style has received popular acclaim for a speaker with a passion for life, and achievement.
He is Managing Director of Business & Training Solutions Ltd ? a sales consultancy based in Ireland and the UK. He can be contacted at firstname.lastname@example.org. 28 Rye Close, Banbury, Oxfordshire. 0044 (0)1295250247