The 80/20 rule has become an unfortunate, but universal truth in sales. Your top 20 percent of reps secure 80 percent of the revenue. While this varies slightly by industry - for example it’s 24.5 percent of the top reps in the technology industry - the long and the short of the situation is that there is a big problem. And that problem is called the frozen middle. The frozen middle refers to the center realm of sales reps that are not performing poorly, but are definitely not at the top of their game. Moreover, they tend to stay frozen in that middle ground, never hitting their full quota. For companies, this can amount to thousands or more in lost revenue potential and big misses when it comes to sales forecasts. This week, Xactly's Vice President of Marketing, Erik Charles, joined the Sales Management Association in a Webinar to discuss how companies can transform their mid-tier sales team into top performers by:
Rethinking onboarding and training
Rep onboarding quite often consists of consecutive days of training, followed by weeks of shadowing other reps. This sounds okay in theory, but often isn’t in practice. For starters, it’s easy to forget information that is crammed in during a small time frame – it is estimated that 50 percent of training is forgotten within five weeks. For many reps, this training “blitz” never fully gets them immersed in the material they need to understand to become a top performer. Offering a library of bite-size training courses will help not only new reps, but also existing ones, digest material more easily. Moreover, they will have the ability to easily review materials when, where, and as much as they need to get the materials down pat.
Research shows that companies see an 88 percent increase in productivity when they combine training and coaching (vs. 23 percent with training alone). Some of the reps frozen in the middle might be your next stars in the making. Who better to coach them than the star sales reps themselves? For example, have your top reps tape themselves giving their winning pitch and make it available for all reps to watch and learn. Then have those reps frozen in the middle record their own pitch and get feedback from their peers. For some, this may sound daunting, but it’s also one of the best mechanisms to enhance their delivery and message when speaking to prospects – and hopefully their win rate.
Nothing demotivates a rep faster than feeling they are not being paid fairly. For many years, quota setting has been an art. The big data revolution, however, is removing the need for arbitrary survey data and “gut feelings” when it comes to compensation planning. Today, compensation planning is a science. Companies need to utilize big data intelligence from companies of similar sizes and industries to ensure they are paying reps competitively from the start.
Getting creative with SPIFs
With the holidays looming, it is not uncommon to start to see a slowdown in performance this time of year. For those on a calendar fiscal year, this can be especially problematic. SPIFs are a quick way to get the competitive juices flowing and better motivate those middle performers to reach their goals. Your contests can be as simple as offering big screen TVs, or as big as doubling credit toward President’s Club.
Analyze, analyze, analyze
The above elements are really only valuable if they are working. It’s critical that companies closely align their training, coaching and accelerator efforts with the performance of reps to view where there is alignment. Are reps that were previously stuck in the middle improving after taking certain trainings? Are reps that are utilizing specific peer-to-peer trainings getting closer to their quota? Did the SPIF drive the desired outcomes in terms of performance? If not, it’s time to rethink the approach. The 80/20 rule has been accepted in sales for far to long. By following these tips, hopefully you will be well on your way to thawing the frozen middle and moving more of your reps to the leader board.