Whether 2013 was a banner year for your sales and marketing organization or one preferably forgotten, it’s winding down. As we look toward 2014, it’s important to plan ahead to sidestep the past mistakes and build upon the triumphs. Mark Donnolo, Managing Partner of SalesGlobe, a sales effectiveness consulting firm, offers the following real-life 2013 bests and worsts.
Don’t try this at home:
Incentive to fire. A major telecommunications company decided to pay a financial incentive to its sales managers, based on the percentage of reps on their team who hit quota. The incentive, however, didn’t state that the sales team had to maintain a certain headcount. So as the end of the quarter approached and the managers began to calculate their bonuses, they fired reps who had not achieved quota to protect their own percentages, rather than coaching those reps toward improvement. A short-sighted move that completely ignored the big picture, and that they will likely pay for in the end, when it’s time to calculate senseless turnover costs and the price of training new salespeople.
Who’s zoomin’ who? A healthcare sales organization installed GPS devices in the phones of its reps to track how much time they spent visiting healthcare provider offices. This didn’t motivate an increase in sales behavior, though. Once the reps realized what the company had done, they would park their car at a doctor’s office within walking distance of a shopping center and run their errands, leaving their phone in the car to appear as if they were making a sales visit. A complete communication breakdown that ultimately diminished employees’ trust in the company and demotivated them even more.
Thanks, but no thanks. A sales organization designed its incentive pay for sales reps around profit margin rather than dollars. Reps were paid on the profitability of the deal, rather than how much money the deal brought in for the company. If a rep came close to selling a deal to an interested customer, but then realized the deal had a low profit margin, they would walk away from the sale completely. This, of course caused the company to lose valuable sales and customers, but the reps were paid well because they made sure their margins were intact. Salespeople have to be trained and given the motivation to solution-base sell for the betterment of the whole organization, not just their incentive check, and this responsibility falls entirely on the organization.
Follow these leaders
A finer beer seller. A major beer distributor paid for its sales reps to become certified cicerones, which is the equivalent of a wine sommelier. The sales reps, whose jobs had previously focused on selling (and in some cases delivering) as many cases of beer as possible into the back room refrigerators of grocery and convenience stores, now had the power to spend more time talking to their customers about what types of beer their end-customer (the consumer) wanted to buy. The reps became true advisors to their retailers and end consumers about craft beer and food pairings, increasing the engagement and job satisfaction of the sales rep, and ultimately selling more beer to the consumer, for the company.
Help me help you. A telecommunications company had its sales leaders take an in-depth personality assessment, which gave individual psychological and intellectual profiles, using the reports only in a positive way. The sales leaders were asked to meet with an outside coach once a month for 12 months, and were given an individual coaching plan to help build on their strengths and achieve both personal and organizational goals. The managers are so far enjoying the process, and the sales organization has seen higher performance and job satisfaction, a perfect example of an organization taking care of its salespeople — through costly training — and reaping the benefits of them doing the same in return.