Business Results & Personal Development
for CEOs & Key Executives
Home   |   About Us   |   Lit Request   |   Contact Us   |   View
847-208-8709         Email  
Download Free Article

"Best Practices for Managing
in the Best of Times"
Best Practices
Business Results   »
Personal Development  »
Growth Coaching
Executive  »
Sales Manager »
Sales Rep  »
Chally Tools
Sales Reps  »
Sales Management  »
Managers  »
Executives  »
Vistage / TEC Tools
Vistage Works   »
CEO Peer Groups  »
Key Executive Groups  »
Trusted Advisors  »
Request Literature
Sales Recruiting  »
Sales Compensation  »
Exceptional Managers  »
Resource Links

CEO Best Practice: Sales Force Management & Motivation

Executive Tools

  • Executive Summary
  • Self Assessment Checklist

Expert Practices Articles

  • The Sales Manager: Areas of Expertise
  • Models of Sales Team Performance
  • Coaching to Increase Sales
  • Finding the Right Sales Compensation Plan
  • The Sales Plan
  • The CEO, Sales Force and Customer
  • Coaching in the Field

Case Histories

  • Use an Integration System When Hiring a Sales Representative
  • Track the Selling Activities of Your Remote Sales Force
  • Start New Salespeople on a Commission Base
  • Plan, Plan, Plan
  • Focus on Commissions
  • Teach Networking Skills to Sales Reps
  • During a Downturn, Sell to the Customer's "Pain"

Tools & Analysis

  • Coaching: It's Never Over
  • A Leadership Action Agenda
  • Sales Methodology Audit Survey
  • Top Ten Rules of Sales and Marketing
  • Checklist: Are They Intrapreneurial?
  • Success Checks: Evaluating Your Sales System
  • Success Checks: Support Your Sales Staff

Book List: Sales Force Motivation and Management

Request the Entire Best Practice Module: Sales Force Motivation and Management

CEO Best Practice: Sales Force Motivation and Management

Executive Summary

  • The Sales Manager: Areas of Expertise
  • Models of Sales Team Performance
  • Coaching to Increase Sales
  • Finding the Right Sales Compensation Plan
  • The Sales Plan
  • The CEO, Sales Force and Customer
  • Coaching in the Field

The Sales Manager: Areas of Expertise

The job of the sales manager is not to grow sales. Instead, say Vistage sales management experts John Asher, Jack Daly and Paul Goldner, the sales manager's job is growing salespeople. In fact, Daly prefers the title "sales leader."

Gone are the days when threats and intimidation worked as sales management tactics to wield at frightened troops. Today, says Goldner, the ability to persuade is far more important.

"The sales manager sets the course for the most efficient system of selling the company's goods," he says. "By her statements and actions, the successful sales manager inspires the sales team to act in ways that are in everyone's best interests."

An effective sales manager also possesses insight into the personalities of her sales team, Daly says. "The sales manager is there to cultivate and refine the talents of the salespeople, and should make sure they're aware of this. As time passes, the salespeople start to understand the purpose behind efforts to enhance their skills. Gradually, this drive toward excellence comes to replace money as the prime motivator in doing their jobs."

Recruiting is a process, not a single-time event. It should be ongoing and continuous. Just as a salesperson has (or should have) a database of qualified prospects, so the sales manager should have "a basket of people" he'd like to have come work for him.

The Vistage experts advise these steps for keeping the "sales force" pipeline filled:

Request the Entire Best Practice Module: Sales Force Motivation and Management

Models of Sales Team Performance

Goldner identifies key sales activities that should be continually tracked:

  • Dials. How many calls does it take to reach a key decision-maker?
  • Appointments. How many customer appointments are generated from completed calls?
  • Recommendations. How many proposals does the salesperson create as a result of his appointments or meetings?
  • Sales. What is the number of winning proposals?
  • Sales dollars. How much revenue is produced by sales?

Goldner recommends recording the sum of these activities weekly. "The goal is reaching a point where you know what every call is worth, what every appointment is worth, what every presentation is worth and, finally, what every sale is worth. Now you not only have made your sales predictable, but you can clearly articulate to future sales candidates what's needed to succeed."

"How well can a salesperson perform without understanding what's expected of her?" Asher asks. "Expectations spell out what's required to succeed, and it's best to articulate these during the training period."

For more seasoned salespeople, job expectations can be defined by:

  • Number of customers
  • Dollars of sales per period
  • Gross profit margins

Daly suggests actively involving sales reps in the goal-setting process. "If you want the sales staff to become more accountable, ask them to set their own goals," he says. "Review their performance against these goals on a regular basis. Make it very clear what's expected of them."

Of course, any sales lead is only as good as the customer's final decision to buy. The sales manager should closely scrutinize the company's marketing and sales process areas, with respect to ROI generated by the sales team's leads.

  • How do leads come in? What is the quality of these leads?

Request the Entire Best Practice Module: Sales Force Motivation and Management

Coaching to Increase Sales

To help turn around a poor performer, the Vistage speakers advise these steps:

  • Document the situation. Gather facts. Identify problems in the salesperson's performance.
    Advise and counsel. Meet with the sales rep, making it very clear that your goal as sales manager is to help him become better at his job. Avoid placing blame or delivering ultimatums. Instead, demonstrate your confidence that, with coaching, the problems can be overcome.
  • Look for problem behaviors. Ask the sales rep what he thinks should be done to overcome gaps in performance. Does it mean adjusting selling behavior? Making more new business calls? Find out what difficulties, if any, he anticipates in changing his behavior. Address these difficulties before they occur.
  • Design a recovery plan. The plan, developed jointly by sales manager and salesperson, should be comprehensive and results-oriented. Set targets based on (1) improvements in sales with each account; (2) new business penetration; and (3) increased number of calls.
  • Have a follow-up plan. Following agreement on a recovery plan, the sales rep must understand that the sales manager will closely scrutinize sales efforts and results. The follow-up plan will track results and progress, supplemented by weekly follow-up meetings.

"When salespeople don't hit the targets, hold their feet to the fire," Daly says. "In some cases, you may want to renegotiate the expectations. But if these were fair to begin with, you're better off sending that person on the way to their next career opportunity."

Recognizing top performers is another vital function. "How many salespeople are overly recognized for their achievements?" Daly asks. "Is there such a thing?" When he visits Vistage companies, Daly asks members what recognition systems they have in place for top performers. Surprisingly, not enough companies have any such system.

Request the Entire Best Practice Module: Sales Force Motivation and Management

Finding the Right Sales Compensation Plan

Goldner advises linking your company's objectives and commission structures, and placing salespeople "in the same boat" as everyone else. "Is your focus on profitability?" he asks. "Then compensate based on gross profits. Is the focus on new accounts? Then compensate based on that. Choose two or three objectives that are vital to your business and develop these in your compensation plan."

"You have to incentivize the behavior you want," Asher notes. "For example, if you're pushing a specific product, raise the commission rate on it. You can further devise a formula for basing the commission on sales and gross profits and the sales team's overall performance. Many different options exist."

The Vistage experts and others favor this option: salary plus commission. "This approach typically combines the best and worst of the first two compensation structures," Asher says, adding that while the equation differs among industries, most fall in the ranges of 40-80 percent salary and 60-20 percent commission.

How does a company determine the best sales commission rate? The Vistage experts point to these options:

Request the Entire Best Practice Module: Sales Force Motivation and Management

The Sales Plan

"Sales quotas should serve as a goal," says Goldner. "Generally, they originate from upper management and percolate down to the sales staff, without much in the way of negotiation. But an effective sales manager meets with the sales team, discusses the quotas and other motivational issues, talking about strengths, weaknesses and opportunities. The idea is moving everyone in a positive direction."

Above all, Asher notes, the sales manager must have a clear understanding of how the organization's overall revenue goals impact individual or team sales quotas. "There are so many factors -- from company objectives and the number and size of territories to each sales rep's experience -- which influence goals and performance, that the sales manager has to gauge a proper balance when planning sales quotas."

Goldner is a forceful advocate for producing goals-oriented sales reports. "Well-designed sales reports motivate salespeople by making very clear what needs to be accomplished and what has to be done to accomplish it," he says. "These reports also help the manager measure specific behaviors salespeople must produce in order to get the job done."

All the talk about quotas and reports leads back to one sales management priority: helping salespeople grow.

"One way they grow is by being goal-oriented," Daly says. "The more focused the sales force is on specific, achievable goals, the greater their chances of achieving them. Of course these goals have to be aligned with the company as a whole. The sales manager's job is making sure these goals are coordinated and attainable."

These goals may include:

Request the Entire Best Practice Module: Sales Force Motivation and Management

The CEO, Sales Force and Customer

Creating a "sales-friendly" corporate environment is -- or should be -- a CEO priority. The Vistage experts suggest the following actions to keep your sales force on the cutting edge:

  • The right tools. To succeed, your salespeople should be equipped with the best support -- pagers, cell phones, laptop computers -- available. This enables them to do their job better, and demonstrates their importance in the mind of the prospect/customer
  • Support on the inside. Make sure other departments are working with, not against the sales force. "All too often," Asher notes, "internal departmental turf battles defeat the company's overall goals."
  • Recognize achievement. Salespeople respond to a variety of motivating factors, but in nearly all cases, recognition for a job well done ranks high. As CEO, you can make sure that top performers (and those working toward that goal) are honored throughout the organization.
  • Be seen and heard. "The CEO's occasional presence at staff meetings is a prime motivator in itself," Goldner says. "Keep the sales force updated on changes in your products and services. Listen to what they have to say about life in the field."
  • Focus on training. Continuous training makes for better salespeople. Make sure that training is one of your company's top priorities.
  • Help wherever you can. Set a regular schedule (at least once every quarter or every six months) to meet with the sales manager and his team and ask them directly, "What can I do to help you make more sales?" Create a "no-blame" atmosphere where salespeople feel comfortable in objectively assessing current situations and needs. Then do what's needed to make them better at what they do.

In the past, say the Vistage experts, that might have been enough knowledge for any individual salesperson to have. Today, the sales rep should know the customer's business, too. "One helpful approach in this area is inviting the customer to come in and talk about her business with your sales force," Asher advises. "Also, at regular intervals, dedicate an entire sales meeting to educating the sales force on the ins and outs of the customer's business."

Request the Entire Best Practice Module: Sales Force Motivation and Management

Coaching in the Field

Asher's advice: Map out your joint strategy before making the sales call. "The sales manager and her rep should review and refine the approach the rep will use in the field. How can the manager support him? Can they leverage a situation to gain access to key decision-makers in the customer's organization?"

Coach in the field, not in the locker room, Daly says. "Too many sales managers are busy shuffling papers, filling out reports, sitting behind their desks. They should be out making calls with their salespeople, helping to train them in ever more productive sales techniques. If you're not training, you're not gaining."

Daly recommends three kinds of "coaching calls" -- on-site visits (to customers or prospects) with the sales rep, in order to provide coaching and feedback for improvement:

Request the Entire Best Practice Module: Sales Force Motivation and Management