Businesses can't run effectively if their employees are unhappy. In fact, morale has a huge impact on the success of a company. Unhappy employees don’t perform at the same level as enthusiastic motivated employees, and it’s up to organization leaders, managers, and company culture to improve employee morale and keep performance high.
This is especially true for sales organizations. When morale tanks, sales performance often follows suit. Therefore, sales managers must identify unhappy reps, uncover the cause, and implement a strategy to improve employee morale ASAP.
What Causes Low Employee Morale?
Low employee morale can happen for several reasons. In sales organizations, company culture does play a role, but often it is a combination of the company’s culture, sales plan, and coaching methodologies.
In fact, believe it or not, sales territories can cause low morale if they are not designed to provide maximum sales coverage and balanced opportunities for each rep. Commission payout errors can also result in diminished team morale. Other times, however, poor morale results from things outside reps' sales commission structures. This can be anything from changes in leadership or team structure to evolving culture or having a rough quarter.
Simply put, regardless of the reason, sales reps who are unhappy at work aren't motivated to do their job. In these instances, managers must adjust sales plans and find ways to improve employee morale and keep reps on track to reach their goals.
Ways to Improve Employee Morale
Successful sales organizations motivate their reps effectively, while driving growth and revenue. Most often, incentive compensation is the main driver of sales behavior, but there are additional coaching tactics and financial rewards that sales leaders can use to motivate reps and improve employee morale. Here are 23 easy ways to get started.
- Assess Your Current Sales Compensation Plan
- Evaluate Your Sales Territory Map
- Optimize Your Compensation Administration Processes
- Implement a SPIF
- Take Advantage of MBOs
- Hand out Performance-based Bonuses
- Try out Team-Based Incentives
- Give Positive, Effective Feedback
- Take Time to Talk to Your Reps
- Consider How Tenure Plays a Role
- Invest in Employee Training
- Advocate for Career Advancements
- Circle Back after Big Projects
- Be Transparent with Promotion Expectations
- Recognize Signs of Burnout
- Take Steps to Prevent Turnover
- Allow Reps to Brag a Little
- Acknowledge Stellar Performance
- Encourage Reps to use Their Earned PTO
- Get out of the Office as a Team
- Make the Office Environment Fun
- Throw in the Occasional Surprise
- Examine Your Overall Company Culture
Improve Morale by Adjusting Plans and Processes
Sales compensation plans are the biggest performance driver, so it’s vital for companies to ensure their plan is not only motivating reps, but also driving the right sales behaviors. Start by evaluating your sales compensation plan and ask yourself the following questions:
- Do reps earn commission for behaviors that align with organizational goals?
- Is a capped commission or low rates encouraging reps to stop selling after hitting quota?
- Are compensation plans tailored to different sales roles and responsibilities?
Leadership should also ensure plans are simple and precise. When there is confusion around how reps earn commission, morale drops. The simpler, more concise your sales compensation plan is, the higher morale will be.
Believe it or not, your sales territories have a huge impact on team morale. The strongest sales territory maps are balanced, fair, and offer equal opportunity for reps to hit quota. How do companies do this effectively? To be frank—they ditch their spreadsheets and use data to drive planning.
By combining third-party data with internal insights, companies can map out stronger territories using an automated territory planning solution. Plus, well-designed territories improve employee morale, reduce planning time by 75 percent, and result in up to 30 percent higher sales objective attainment (Read more about territory planning best practices in our recent blog).
Consider this: you get your paycheck, but it’s not the right amount. Come next pay period, you’ll definitely be calculating your pay down to the cent to make sure you’re paid right. You probably won’t be spreading cheer and high morale around the office either.
When sales rep commissions are inaccurate, they waste time shadow accounting and are not motivated to perform well. Ensuring reps are paid accurately and on-time allows them to focus on their job—closing deals. And when your sales team is confident their commission checks are accurate, morale is improved and they are more motivated to sell.
Improve Morale Using Additional Financial Incentives
Also known as special performance incentive funds, SPIFs are short-term incentives that encourage reps to sell a specific product/service, contract terms, etc. Each time they do so, they earn a financial reward. For example, to boost sales of a particular product, you might pay reps $500 for each deal they close.
It’s important to remember that SPIFs can be extremely effective to increase employee morale in the short-term, but they should not be used as a long-term solution. These incentives work best when they are used sparingly, and when used too frequently, they can lose their effectiveness.
Management by Objectives (MBOs) helps motivate sales reps outside of their primary compensation plan. This helps you keep reps on track and motivated by measuring and rewarding on metrics other than deals closed. MBOs can also be a great way to improve employee morale for non-sales employees because they can be personalized and tailored to each individual.
Every employee loves a bonus, plain and simple. There's nothing like a pat on the back for a job well done. And it's even better in the form of a bonus check. Like MBOs, bonuses can be tied to objectives or goals outside of an employee’s set responsibilities. They can also be used to improve employee morale as a spontaneous reward for a job well done and motivate team members to keep up the good work.
Team-based incentives aren’t ideal for every company, but they can help promote collaboration between sales reps and help teams to hold each other accountable. These rewards improve employee morale by boosting team camaraderie and encourage sales reps to share selling tips, advice, knowledge, and expertise so everyone succeeds.
It’s important to note that team-based incentives should be based around goals that each individual sales team member has an impact on. That way each rep’s performance helps achieve the team objectives.
Improving Employee Morale with Culture and Coaching
Positive manager and employee relationships are important for high morale. Effective feedback can help improve employee morale by encouraging constructive criticism and creating open communication channels between manager and employee. To ensure it is positive and effective managers should make feedback:
- Timely: Managers should address any problems as soon as they arise.
- Specific: Conversations should address only the issue at hand and shouldn't bring in related or similar incidents, projects, or topics.
- Objective: Managers must put their personal feelings or any differences aside to ensure feedback is free from outside influences.
- Constructive: Feedback conversations should always be presented in a positive, constructive way and offer solutions to fix it if possible.
To further strengthen employee-manager relationships, sales leaders should take time to get to know their reporting reps. This helps both individuals understand how the other communicates, working styles, and what truly motivates them.
Taking time to check in with each team member also allows leaders to give employees individual time with the boss to discuss roadblocks, goals, and career paths. With this understanding, managers can take advantage of MBOs and bonuses with personalized incentives.
For sales organizations specifically, sales rep tenure plays a big role in performance. According to Xactly Insights data, sales reps hit their peak performance between years two and three on the job. The data also showed that rep performance and morale tends to drop off around the five year mark.
As employees gain tenure, sales managers should sit down with the employee and discuss potential opportunities for the rep to grow in their career. For example, to improve employee morale and keep it high, leaders should consider a new territory or a promotion to different roles as reps gain experience.
One of the top reasons sales reps leave their job is because of inadequate training and lack of education opportunities. Furthering education is an important aspect in sales or any position in an organization. It's also important to consider team career goals and provide opportunities for employees to obtain the education and resources they need to move towards them.
Whether the education is a conference, learning summit, or online course, this gives employees the opportunity to increase their skills. It also helps improve employee morale by giving team members time outside of the office. The opportunities also build your network and establish relationships that will help employees personally, along with the business at some point down the line.
Along the same lines as tenure, managers should take team member’s career goals into account when trying to improve employee morale. If possible, allow them to explore different roles and projects to find their niche.
The ability to try out new roles and responsibilities allows reps to truly develop their career skills and create a path to achieve those goals. It’s a testament to both the transparency of everyone’s responsibilities, along with the organization’s initiative to encourage employees to educate coworkers on what’s required of them in their role.
Why track metrics if you’re not going to analyze them after a project is complete? Taking time to sit down as a team and debrief together allows everyone to recap while items are still top of mind. It also allows individuals to voice any concerns instead of burying frustration until it’s detrimental.
With an open communication follow-up on each project, employees are encouraged to share and better understand what worked and what didn’t. This ensures the next project will run more smoothly and that each person’s voice is heard, ultimately improving employee morale.
Transparency is key in any managerial role. It is also important when it comes to role expectations. Each team member has their own career goals, but it’s important for them to understand the steps they need to take and performance they need to achieve for promotions.
Provide clear guidelines for what's expected to move up and then what is expected after a promotion. The more guidance you can give employees, the better. You may consider hiring a compensation expert (like Xactly's strategic services team) to help. They can work on every single employed position, figuring out industry and position salary averages, and then establishing tracks for advancement.
Burnout is a real threat in any organization. When employees are overworked, they can become disengaged and morale may suffer. Because of this, it’s vital that sales leaders check in on their team frequently in one-on-one meetings and become aware of the signs of burnout.
Because sales can be a stressful, high tension job, reps are at a higher risk of sales burnout. Leaders should work with employees to destress and be on the lookout for key burnout symptoms, including:
- Physical exhaustion
- Emotional exhaustion
- Increased negativity
Poor employee morale can also lead to increased attrition. For sales organizations, this can result in lost deals and cost thousands of dollars to replace a top-performing rep. Often it is because leaders take action to prevent turnover too late.
Tools like Xactly Insights give sales leaders deeper visibility into team performance. The solution can flag performance dips and identify reps at risk for turnover. This gives managers more time to intervene, improve employee morale, and prevent attrition.
In many organizations, when sales wins, everyone wins. When sales reps close a deal, they might share with the team, but why not brag on them a little more? Even something as small as a company-wide email, ringing the “deal closed” bell, or giving a round of applause can improve employee morale and motivate others to increase their performance. Leaders should encourage sales reps to share their closed deals with the team, and give them time to celebrate the win before telling them to get back to work.
A little pat on the back for a job well done is always appreciated. When employees—whether sales or non-sales—perform well, they should be celebrated. Like a closed sales deal, a company-wide email, shoutout in a meeting, or even passing around a trophy can help boost and improve employee morale and keep the work environment fun.
Let’s face it. Even top-performing sales reps need a break from the office. Modern companies are starting to offer generous paid time off (PTO) packages As a manager or leader, never impose guilt on employees using their earned vacation time. Give employees the time they need (within reason, of course) to mentally recharge while they're away, so they're full of fresh ideas upon their return.
Team-building can take many forms, and can be anything from a full day out of the office, working on fitness or watching tv together, to a monthly hour-long lunch and learn. Most importantly, team building should be more than a free day out of the office.
However, it’s not just the act of giving a “break” to your team by doing something fun. By interacting with coworkers you might only see in passing or when a deadline is near, you open the channels of communication when everyone returns to the office. You make “hellos” and “goodbyes” more commonplace, and you instill confidence in your team to give constructive feedback, and create the mindset to receive it.
Especially if you’re in a formal workplace setting, giving your people the chance to take part in a work holiday can help boost morale and create a relaxed environment. The easiest, most fun thing would be to simply follow the calendar. Halloween and other holidays are obvious occasions through which to set up some sort of office theme day, but get into the spirit of the Super Bowl and other big events.
Being spontaneous is a great way to improve employee morale. There are several ways to surprise sales reps and motivate them to keep working hard. For example, it can be as simple as letting the team leave early on a Friday. Of course, the point is that these surprises are spontaneous and sparing, so leaders should avoid making it a regular occurrence to curb expectations, so be creative and different with how you go about being spontaneous.
Morale stems from company culture and trickles down from leaders to employees. It’s important to understand that attitude starts from top management and spreads to the rest of the company. Managers should work hard at setting a good example and leadership should examine the organization mission and vision in order to instill positive culture into every part of the company (You can read about Xactly's C.A.R.E values here).
Improve Employee Morale for the Long Term
Believe it or not, small changes—either through compensation or management—can have a big impact on your sales team morale. Sales managers help reps hit their number, but they also bear the weight to improve employee morale during hard times. With the right mindset, leaders can motivate their teams not only to reach their quota, but to perform beyond it. It all starts with the right motivational spark.
Want to learn more ways you can motivate and improve employee morale? Download our guide, "Inspiring Sales Rep Performance."