This past week I was lucky enough to belong to and attend two different sales leadership networking groups. In both sessions there was some spirited talk about the fundamentals in how to set goals for your sales reps.
The first session was at Communitech in Waterloo and lead by the Mike Stankowitsch from Open Text and the second was at the Sales Leadership FC meeting in Toronto.
Below you will find the highlights of my input into the conversations.
- Goals for a sales professional should be set in 4 different areas including results, funnel, activities, and development.
- Results can be goals set on revenue, profit margin, or accounts closed. Most sales positions have goals in these areas.
- Funnel goals help insure that opportunities are moving towards results. Targets can be set on the size of the funnel, growth of the funnel, opportunities in each phase, or the speed at which the opportunities move through the funnel.
- It is key to set goals based on the activities that lead to the sales results. This can mean targets on telephone calls made, emails sent, meetings booked, demos, or joint calls. Activity targets reinforce the things that need to be done that will lead to sales success. This is especially effective when you have a new rep in a territory with no existing accounts. Closing new accounts may take several months, but activity targets can be measured from the start.
- The final area that is often overlooked is development. You can work with the sales reps on the things they would like to improve upon or continue to foster. The funnel review can highlight areas for improvement. A rep may be having issues on getting the first meeting. This could indicate a deficiency in cold calling technique. The solution doesn’t have to mean taking a third party course but could include the manager helping with making time for calls, practice with objection handling, refining the value proposition, or even reading a book. Some of the goals can be assigned top the manager or human resources to help source books, courses, or time to help the rep achieve their goals.
Before setting the goals they should be tied back to the companies overall goals, vision, and values. Revenue targets for the teams should roll-up to the company targets. Values on customer service could be tied to customer testimonials or contract renewals. It is important that the reps goals and the company goals do not conflict.
Insure that the goals are SMART.
Regularly review the goals with the rep. I like having monthly meetings with the reps where the revenue, funnel, and activity goals are all reviewed. Development goals can be reviewed on quarterly basis. Most CRM systems have good reporting functionality and can often be used to quantify the revenue, funnel, and activities. Using the CRM as an integral part of the review will also lead to great use by the sales reps.
As always comments and suggestions are welcome.
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