Sales Culture Tune-Up A to Z (Part 2 of 3)

Sales Culture Tune-Up

This week we’re doing to dive deeper into the subject starting with another crucial sales culture component, performance management.

Performance Management:  Another key component of your sales culture is how sales performance is managed. Some companies have a low-pressure sales culture where sales performance is loosely managed. In these companies, sales managers act more like sales supervisors than sales managers and sales leaders. Little attention is paid to hitting quarterly milestones and there are very few consequences if any for not hitting annual sales goals.

At the other end of the spectrum, you have companies with high-pressure sales cultures. In these companies, weekly sales activities are tracked and measured against minimum activity standards. Sales managers track sales team activities closely via a dashboard. If a sales rep’s activities fall below minimums for two weeks in a row, the rep meets with their sales manager to diagnose and correct the situation.

Hitting quarterly milestones is important and provides real-time objective performance feedback. When weighed against a rep’s pipeline, sales managers move quickly to get a sales rep on a “performance plan.” If annual goals are not met, the sales rep is terminated at the end of the year if not before.

While I have briefly painted a picture of two sales culture extremes, the trick is to decide exactly how diligent your company is going to be concerning setting activities standards, tracking activities, goal setting, hitting quarterly milestones, and how frequent sales managers sit down with sales reps to review their year-to-date activities. My personal belief is sales managers should meet quarterly at a minimum with their most seasoned salespeople to review YTD production, pipeline, and business development activities and more frequently with all other sales personnel depending on production levels. A key function of any sales manager is as a developer of people and it is in these one-on-one meetings where sales managers can develop their people.

Most companies fall somewhere in between the two extremes presented. The key though is to decide what is the right balance of sales oversite for your organization then have a performance management system that is aligned with that approach to managing sales.

Hiring and On-Boarding:  Many employment problems can be prevented with strong and consistent hiring and onboarding process.

  • What are the criteria being used to evaluate, hire, and onboard salespeople?
  • Does your onboarding process proudly present the history of your company and the values that have driven your success?
  • Are performance expectations defined clearly upfront before an employment offer is presented so that a prospective employee understands fully all aspects of your sales culture?

Past performance does not always predict future sales success. Salespeople by nature are good at selling themselves. All too often, salespeople interview well and make impressive claims of past sales performance. I am still surprised at how rarely a hiring company follows up with a candidate’s prior employer to verify past sales performance. Seems common sense, but verification of past performance is essential. Your core values also play a critical role in the screening process, to help you identify salespeople with the habits, skills, and industry knowledge to be successful and who also fit your culture. You must have both!

Incentive Compensation:  Incentive plans are another key tool in your sales culture toolbox. Done effectively, incentive plans can increase employee productivity, cultivate employee engagement, and maximize profits. Many incentive plans just do not work. Some pay out too much (wasted money), some too little (not motivating), and some just come to be expected (an entitlement).

To design a proper incentive plan, before thinking about sales outcomes like revenue growth and increase in the number of new customers, you first better ask yourself what are the sales behaviors you are trying to drive? When a company incents for growth, salespeople focus on closing transactions, not relationships. If your company touts being “relationship-focused” as does the banking industry, yet your company incents for closing deals, there is a disconnect between what your company said it’s about and the behaviors of your sales personnel. Incenting for growth does not drive the behaviors needed to improve relationship profitability.

A balanced scorecard approach “weights” a myriad of desired outcomes such as fee income, revenue growth, portfolio growth, individual customer profitability, referrals to internal partners, referrals to external partners and links them to key sales behaviors is required.

If customer retention and improving the profitability of each customer are important, you’ll need a “balance of behaviors” reinforced by your incentives.

Have a great rest of your week,


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