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That's probably the question I'm asked more than any other. Frustrated distributor CEO's and sales managers express that thought over and over, in one way or another. They're talking about their salespeople, of course. They harbor a feeling that some of their salespeople just aren't doing what they want them to do, and they don't know what to do about it.
If that thought occasionally passes through your mind, read on.
"What do you want them to do?" I often reply.
At this point, you're probably thinking, "What an obvious question. We want them to sell a lot, of course."
But that response is too vague and coarse to hold any real meaning in today's world. A few years ago, it was OK to direct your salespeople to "Go forth and sell a lot," but today that direction is not sufficient. Salespeople are capable of more than that. And, the world in which your company operates has changed significantly in the last few years. Our economy has grown increasingly complex, many markets are maturing, the demands and expectations of your customers are growing, your customers' choices of ways to satisfy their needs are multiplying, and information technology is growing more powerful and user friendly. All that means that you need to more finely direct your sales force than at any time in the past. Successful sales management in the approaching 21st century world requires a more sophisticated answer from you than just "Go forth and sell."
I learned that lesson the hard way in my days as a distributor rep. I was doing a great job selling in my largest account. That one customer accounted for about 30% of my total volume. Sales were increasing monthly, and my visibility and influence in the account was growing. If my boss wanted me to "Go forth and sell a lot," I was doing it!
Then, one dismal Monday afternoon, I was sheepishly greeted by my primary contact person, and informed that I was to see the Director of Purchasing. The news from the director was short and to the point. The Materials Manager had signed a prime vendor contract with my arch-competitor. Over the next 90 days, they would be fazing out all of my business and turning it over to my competitor. All of my contact people were disappointed and not in favor of this move, but it had been negotiated by people in higher places.
The moral of the story? I was doing a great job of "going forth and selling a lot." But I should have been getting to know the administrative people and my contact's bosses. If I had been directed to do that, instead of being focused on getting the easiest sales, I may have been able to ward off the end-around by the competition.
I realize that a case could be made that I should have known to do that on my own. After all, don't good salesmen know to do those kinds of things? No. I didn't, and I was a heavy hitter, high-income straight commission salesman. But I was driven by a straight commission compensation program that rewarded me for gross profits in the short term, and I never thought to cover all my bases by calling on my customers' bosses.
But that's just one example. Here's another. One of my clients owns a small but rapidly growing equipment distributorship. Every month his salespeople must count certain pieces of equipment in their territories. Each month he selects a piece of equipment, and requires his sales force to count how many of those there are, where they are, how old they are, what brand they are, and when they are scheduled to be replaced.
He uses that information to make territory and product line forecasts, as well as a basis for developing more sophisticated joint marketing plans with his partner-vendors. I'm sure you'll agree -- that's good information to have. But don't the salespeople do those kinds of things on their own? Do they really need that kind of precise direction from management?
Take a little self-test. Consider each of your salespeople, one at a time. Ask yourself, "Is ...(salesperson's name).... systematically collecting that kind of market information on his or her own?"
If your answer is a 100% "yes," will you please write to me so that I can note your sales force as the single national exception?
Those two examples illustrate just two of hundreds of possible behaviors you could expect from your sales force. In each case, the company's long-term strategic interests were best served by directing the sales force to behaviors that probably wouldn't happen in the absence of that direction.
So, the first step in getting your sales people "to do what you want'em to," is to decide "what you want'em to do."
Ideally, those things proceed directly from your strategic plan. For example, if your strategic plan says that you want to penetrate a new market segment, then you should expect your salespeople to make X calls per month on that segment, or create X new customers within that segment, or do X amount of sales with that segment, or achieve X amount of gross profit with that segment.
The first step is to develop your strategic plan, and then to create expectations for your sales force that directly support that strategic plan.
What, you don't have a strategic plan? That's too bad, you're definitely at a disadvantage. But, you're not disqualified. Just start at step two, and create precise expectations for your sales force. Develop a list of the three to ten most important things you want them to do.
Bringing in a certain amount of sales or gross profits should be one of them, but only one of them.
Next, make sure that your list of expectations are easily, accurately and fairly measurable. This can be difficult. Much of your ability to manage your sales force depends on your ability to measure sales behaviors.
If you're highly automated and use effective sales force software, it'll be a snap. If you're not effectively automated, it'll be much more difficult. For example, one of my clients wanted his sales force to call on new prospects. His business was growing, and his salespeople were happy. But he was sure that there was additional market share to be had in accounts that were not being cultivated. He felt his straight commissioned salespeople were content to call on their friends, and weren't doing the harder work of calling on new prospects. He wasn't automated, and didn't believe his veteran sales force would accurately and thoroughly complete weekly call reports.
His sales cycle (capital equipment) was long, and he didn't want to wait until he saw actual sales numbers. Those sales could occur 12 to 18 months after the first sales call. He determined to measure his sales forces' activity, (calling on new prospects) not the results (sales to new prospects).
We struggled with a way to easily, fairly and accurately measure the activity of calling on new prospects. As we discussed the possibilities, we realized that every customer's name was on the database. We also noted that every quote was produced by a sales assistant in the office, who typed each quote individually for all the salespeople.
Bingo! Suppose we had the sales assistant keep track of quotes made to companies not on the database?
We couldn't measure sales calls made to prospects, but we could measure the next best thing -- quotes made to new prospects. The system would be easy, accurate, and fair.
Having decided that, it was an easy step to give each salesperson a quarterly expectation for the number of "quotes made to new prospects." Our strategic initiative, "Gain market share," turned into a measurable expectation for each salesperson, "Generate X quotes per month to prospects not on the database."
Step one, develop a strategic plan. Step two, create a set of the 3 - 10 most important sales behaviors. Step three, fine tune them until they are easily, fairly and accurately measurable.
Step four, measure and reward the behavior you want. That can mean anything from publishing and posting those numbers every month, to revising your compensation formula, to making their pay dependent on performance of those activities. For example, you could measure the performance of the entire sales force each month, and post it conspicuously for everyone to see.
Another technique is to make those numbers a topic for discussion at monthly sales meetings.
But if you really want to add some power, refine your sales compensation plan to make each person's pay dependent on performance on those numbers. This is not an article on sales force compensation. That's an entire series of articles on its own. However, it's been my observation that most sales compensation plans do not reward the behavior that they say they want. The company's executives say they want salespeople to do one thing, but their compensation plan rewards them for doing something else.
For example, you may be paying your salespeople straight commission based on gross profits. Yet, you may be expecting them to open new accounts, promote certain product lines, or emphasize certain accounts. When you pay them purely by commission, you reward them for the easiest, richest sales. So, your compensation plan says one thing, while you say something else. No wonder it's frustrating.
To encourage your sales people to do what "you want'em to," line your sales compensation plan up directly with your strategic plan. Directly reward those three to ten behaviors that you developed earlier. Consider a performance-based plan that pays them for implementing the company's strategies.
Finally, step five is the single most powerful way to manage your people once you've done all this homework. Hold "accountability-holding, goal-setting, strategy-developing, resource-identifying" quarterly or monthly conferences with each of your salespeople.
At these tune-up conferences do these things, in this sequence:
Dave Kahle ( www.davekahle.com ) is a consultant and trainer who helps his clients increase their sales and improve their sales productivity. He speaks from real world experience, having been the number one salesperson in the country for two companies in two distinct industries. Dave has trained thousands of salespeople to be more successful in the Information Age economy. He's the author of over 500 articles, a weekly ezine, and five books. His latest is 10 Secrets of Time Management for Salespeople.
He has a gift for creating powerful training events that get audiences thinking differently about sales. Dave Kahle's "Thinking About Sales" Ezine features content-filled motivating articles, practical tips for immediate improvements, and helpful tips to help increase sales. Join on-line at www.davekahle.com/mailinglist.html
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