By Tony Cole
“Did I hire my sales people this way or did I make them this way?” This is the question every sales manager must ask.
Fixing performance problems always starts with Standards and Accountability. Accountability means taking responsibility for outcomes – good or bad. Your primary responsibility is to put the BEST team into the marketplace. Much like a general manager in sports, a director of a theatre company or an orchestra leader of a symphony, you have a job and a responsibility to hire and use the best performers.
Raising-the-bar ultimately begins with you taking responsibility for those currently managing. What must you do to get best performance? You are responsible to those who have hired you, to those you lead and to your own family for this best performance.
Step #1 – Take responsibility for your own performance or lack of. Make a commitment to do whatever is necessary to get best performance.
Step #2 – Make your people responsible. Starting immediately, accept no excuses for lack of performance. Make sure there are consequences for sales people who show up late or miss meetings. Do not accept excuses about lack of prospecting activity. From now on, when a sales person uses an excuse, respond with: “If I didn’t let you use that as an excuse, what would you have done differently?” and “What should you do differently in the future?”
Step #3 – Communicate expectations clearly. Tell your sales people exactly what you expect. Ask them to repeat what they heard. Ask them to describe how these expectations impact their day, week, month, quarter and year. What will they do, or change, in order to meet these expectations?
Then ask if they will accept the responsibility of meeting these expectations. They will say “yes”. But ask them if they are “sure”. Again, they will say “yes”. Warn them “It will be hard”.
Next ask them if they are willing to do everything possible to succeed. They will say “yes”. Finally ask them what you should do if they fail to meet these expectations and note the consequences.
You have now raised the bar on expectations. You must now raise the bar on performance.
Step #4 – Establish ambitious goals and make them known in advance. Often the reason individuals and companies fail to perform is because minimal standards are set and people do only what it takes to meet them.
This minimal goal approach sets you and your team up for failure. Starting today, or as soon as you begin goal setting for your next fiscal year, eliminate minimal acceptable standards of performance and embrace a new and different path, one that includes extraordinary standards of performance.
Step #5 – Set extraordinary standards of performance. This step requires a mind-shift in how you look at goals, performance and performance management.
Let’s assume that we are using New Business Sales Production as the Success Metric. We need to establish different levels of performance and get each sales person’s commitment of self -management to a newly identified and agreed to level of success.
The process starts with a discussion about future performance between you and the sales person. It is a meeting you probably already have so the meeting itself should not be new. However, your approach and the discussion in this meeting will be different. Plan for an hour-long discussion that allows the producer to personally define sales goal $$ levels of Good, Excellent and Extraordinary and to understand how they would feel about reaching each of these goals. See below for some suggested dialogue about establishing New Business Goals for the upcoming year.
Though we’ve had this type of discussion in the past, I recognize that I need to do a better job helping you fulfill your potential and meet/ exceed your professional and personal objectives. First let’s talk about your performance this past year.
Your goal this year was $250,000 of new business. As you stand right now you are going to accomplish that goal within a thousand or two. Using one of these words- “good”, “excellent”, “extraordinary” to describe your year, which word would you choose? (Most high quality producers recognize that meeting goal would fall into the category of “good”, but not “excellent” or “extraordinary”.)
Tony, I would say that I had a “good” year.
Ok. Pretend that it’s December 31st of next year (or the end of your fiscal year). You are looking at your new business sales production and you say to yourself – based on the number you have hypothetically produced – that you had a good year. What would that number have to be in order for you to say that you had a “good” year next year?
I will have a good year if I grow my new business production by 10%, so I need to sell an additional $25,000. Assuming I have 10% attrition of my current client base of $250,000, I will need to add another $25,000 to this new business production as replacement. So a “good” new business production number would be $300,000.
Next establish a goal number for “excellent” and a more ambitious number for “extraordinary”. At each step, ask the producer how he would feel about reaching this new standard. Once the producer defines his “extraordinary” level, ask him how it would feel to go home and celebrate this milestone. Help him imagine how this would look, what he would say and do.
Ultimately, ask him if he is willing to do whatever it takes to achieve this “extraordinary” number and then ask him if he will give you permission to coach him and hold him accountable to this exciting new goal.
You have just raised the bar. Now the real work begins– You must hold people accountable.
Now, we must understand and commit to the follow-through—holding people accountable. No doubt holding people accountable consistently is difficult because it requires the discipline of regular inspections and tough conversations. It would be easy if sales people performed as they promised, but this does not happen for many reasons. While some of the obstacles that interfere with performance are personal, others are uncontrollable. However, you must drive your sales people to perform to standards regardless of the issues that interfere.
Your sales people will have different reactions to the new and higher standards, but they will know that the rules are changing. People will not be free to languish in mediocrity and be safe when they are not performing. Some will be nervous, others motivated and perhaps excited. But, if you have the right people, they will appreciate that you are helping them define their future success.
The real challenge is following through. In order to do your job well, you must have fierce conversations with those who are not able or willing to sell. This new course of action will force you to let these people go and it will force those who cannot tolerate this environment to leave.
Once you have established and communicated the new standards, you will need to begin collecting data that helps you determine, in advance and in a real time perspective, how your people are performing (sales activity) and how they will be performing (pipeline and sales results). The idea is to catch them quickly when they start to go off path and to have meaningful dialog about their current status and how it measures up to the standards to which they committed.
When you prepare for a monthly or quarterly one-on-one meeting, you must identify where your people stand relative to their performance for activity and results. You will classify them in one of the four following categories in order to have meaningful discussion.
Making Effort & Has Results- Sales person is performing all necessary sales activities and getting sales results. Your coaching should sound like this. “You are doing well. Your activity and results are at or above your goal. Keep up the good work. Is there anything I can do to help you further?”
Lacks Effort & Has Results- Sales person is falling short on sales activities, but sales results are at/or exceeding their commitment. Your coaching should sound like this. “While your results today look good, we need to look at future results. To do that we must look at your success formula. If you have a 6 month sales cycle and you look at your activity 6 months ago, we see that you performed to put you at your current level of success. However, if we look at your activity level of today, it is only 85% of what your plan calls for. Knowing this, what results can you predict 6 months from now?” If you get push-back as you hold the sales person to his commitment, remind him that he agreed to be coached and to be held accountable.
Lacks Results & Making Effort- Sales person appears to be doing required activity, but results are insufficient. There is something wrong, unless this is a new-hire. Review the sales person’s success formula and verify closing ratio, etc. There are two possibilities: 1.The sales person is padding the numbers (lying about the activities) or 2. Sales person is performing poorly. If the success formula is accurate, you must have the following discussion. “Looking at your numbers, I can’t figure out how you can be exceeding activity goals yet failing in actual production. Either the numbers you are entering are wrong or you are doing a poor job of executing the sales process, skills or techniques. Which is it?” The rest of the conversation hinges on how the sales person answers this question, but it is your job to walk him through the accuracy of the success formula and have him project his true sales results for the year. Remind him that he agreed to certain numbers and he agreed to be held accountable. Going forward, inspect his activity daily.
Lacks Effort & Lacks Results- A sales person who consistently lacks effort and results should not be on your staff. Unless this person is a new hire, he should always be AT or ABOVE sales activity effort level. You must have the following tough discussion. “This is what I was expecting from you and this is what I am getting. Are you the wrong person for this job?” Typically, the sales person will say “no” and will make excuses, referencing the economy, competition, company policy, etc. Your response is “Those are excuses for lack of performance. We had this discussion 3 months ago and have met weekly for the past four weeks. You are not producing. Thirty days from now I need someone in that chair who is going to get these results. I hope it is you. But I assure you someone will be doing this job to these expectations.”
After any of these discussions, you should ask the following: “Do you have any questions?” “Are you still committed to doing everything possible to succeed?” and “Are you sure?”
Be sure to consult with your Human Resources Department so that you are fully prepared to manage people and so that you know how best to follow company protocol.