“Make no little plans; they have no magic to stir men’s blood.”
— Daniel H. BurnhamThe third of three key characteristics of successful sales organizations that we have been exploring in this blog series is that they: Measure (and compensate) sales performance appropriately. With a strategic mix of sale performance metrics, the sales enterprise can link compensation to leading and lagging indicators across the entire company, including HR, Marketing, and Finance. By clearly connecting compensation to winning behavior, these organizations drive results faster. In my experience, three factors contribute to compensation plans that help you win in the market: 1) The fewer metrics you measure, the better. The fewer metrics you measure, the more meaningful they become, and the more time your sellers will spend directly with customers. Too many metrics have the opposite effect. They prevent the right sales behavior in two ways:
- Sellers will spend less time with customers and more admin time ensuring their “scorecard” looks good to upper management. This isn’t productive behavior that leads wins market share or increases customer loyalty.
- More internal staff positions will be created to manage the internal scorecard. These resources are better allocated to direct customer engagement, which is needed to win.
- Sales manager’s ability to coach a sales methodology
- Seller’s ability to complete a meaningful sales plan, including relationship mapping and competitive strategy
- Sales: Seller’s ability to complete quality sales plans
- Marketing: Marketer’s ability to supply sales team with relevant industry value messaging, that the seller can customize to specific customers
- HR: HR’s team use of behavior-based interview techniques to hire new sellers based on identified leading indicators
- Finance: Link bid and proposal funding to established qualification criteria in the sales methodology that justifies the cost of a sales pursuit.
Ryan Kubacki is President of Holden International, a global sales training and advisory firm. He is also co-author of The New Power Base Selling: Master the Politics, Create Unexpected Value & Higher Margins, and Outsmart the Competition. Pre-order your copy.
You can contact Ryan at firstname.lastname@example.org and 312/476-8704.