Not a member? Sample unlocked content here.
Achieving your sales target is a primary goal of all sales organizations as well as sales professionals. Here are a few tips that you can use to meet and exceed their sales goals.
Ask yourself these questions:
1) Have I set sales quotas?
It should go without saying but each sales professional needs to have specific goals. It is in their DNA to work against a goal. The delicate balance between having a goal that is too high or too low is a key factor in determining the success or failure of a sales quota program. Focus on what is achievable with reasonable effort. Be sure to create an incentive program that rewards achievement, and I encourage everyone to implement a policy that pays higher dividends to those that over achieve. It is disconcerting to see organizations not pay for super performances.
2) Have you set different targets for different levels of sales professionals?
Often overlooked is the need to adjust quotas based on factors beyond your control. For example, if you sell a product in San Francisco and your colleague works in Enid Oklahoma, clearly the sales quota should be higher in the larger territory. Unless the product you are selling is specific to oil rigs. (i.e. Enid, OK has a lot of oil rigs) The point is simple, look at the territories and determine the areas that have the best opportunity to succeed. In fact it is not unusual to set quotas by geography. For example, this territory should produce x revenue and a different geography should produce a certain revenue stream. Then assign people to the geography and they adopt the quota that is attached. This is fair and it works quite well if you do your homework upfront.
3) Are the quotas you have set attainable?
All too often companies assign crazy quotas based on the corporations need to achieve a revenue goal. I have seen companies simply say, "We should do $20 million" and then split that number up between the sales force. Think this through. You need to assign a logical quota based on research and fact.
4) How did you determine the sales targets?
I touched on this earlier. There are many ways to determine quotas. Geography, historical achievement, market research, competitors’ actual sales, etc. You need to select a method or methods and stick to it. Be logical, practical, and assign targets that can be achieved. Too often companies change their minds mid-year and change the compensation plan. This is deflating to sales professionals. Annual changes are expected, wait until yea- end and make the changes.
5) Have you projected how these targets are going to be met? In other words, what percent of your revenue is going to come when throughout the year?
A great exercise to go through is to look at five years of history as to when you created your revenue flow. Average the totals over 12 months and you are able to typically forecast when the revenue should flow into the organization. Many companies do the majority of their revenue in the first and last quarter. Others most of the revenue at the end of the year. This is a stat every sales manager needs to know so you can manage to it.
6) How often do you measure quota attainment?
Please, please don't tell me you only measure once a year. Quotas should actually be set on an annual, and at a minimum quarterly basis. Depending upon what you sell, it is critical to monitor each and every sales professional’s journey to quota attainment. I always liked to meet with my team quarterly and discuss what they are doing to reach their numbers. This practice will save you a lot of headaches at the year end.
7) Do you offer incentives once quota is attained?
Every compensation program for sales professionals needs to have bonus bumps when they achieve quota. We have seen extra percentage points added for all revenue above quota; we have seen bonus percentage points paid backward on the revenue already generated; we have seen cash bonuses and even goods like cars and Rolex's. It really doesn't matter, you need a carrot out there for the best of the best.
8) Have you determined a sales professional’s total compensation based on quota attainment, and relayed that figure to them?
Compensation and target-setting 101. Do it for you and do it for them. I would bet your CFO already did it.
9) Have you laid out a clear path to achieving their quota?
It amazes me that companies spend hundreds of thousands of dollars on sales professionals and don't put the tools in their hands to succeed. Even if you hired a hot shot, you still need to provide a path to success for them. Give them the tools, (ROI, Discovery Questionnaires, Research tools, Proposals, Business Case, etc.) and then a clear path to success. Train them on your process, tools and products. If you fail in any of these areas, it will negatively affect the opportunity to achieve their quota.
10) Have you determined the consequences for not achieving quota?
One of my favorite stories of Siebel is when Tom Siebel every quarter fired the bottom 5% of the sales team and turned their leads over to the top achievers. Have a plan and let everyone know what the consequences are if they fail to achieve their quotas. After a while they just quit, knowing their fate.
Setting sales targets is a delicate exercise in science, logic, and personality. You need to take your time when determining sales goals and their impact on the compensation program.
About the Author:
Michael Nick is author of the book, ROI Selling, which became the standard for developing sales tools and using them throughout the sales process. He is also author of Why Johnny Can’t Sell and The Key to the C-Suite. Michael can be reached at 262.338.1824 or mnick@roi4Sales.com.
Disclaimer: The views and opinions expressed in this article are strictly those of the author. CPSA does not endorse any of the companies, products and services mentioned within this article.
- Protect Your Customer Base: 3 Strategies for Retaining Your Most Profitable Accounts
- Beware the Customer King – Avoid Marketing Mishaps
Not a member? Sample unlocked content here.