Many years ago when I began my sales career, one of the administrative assistants in my department made the comment, “It sure would be nice to be a salesperson, they get to do whatever they want and come and go as they please. What a great life!”
Now that I think about it, that does sound great. However, that is not the life of a successful salesperson. It sounds more like the life of an administrative assistant to me. Actually, I think there was a lot of truth to her statement. The majority of salespeople I come in contact with have very little accountability for their activities and performance.
I put the majority of the blame, for lack of accountability, squarely on the shoulders of business owners and senior management. Even though they provide guidance and direction for their salespeople, they typically don’t hold them accountable. There is a huge distinction between direction and accountability. The average salesperson will hold themself accountable for achieving the lowest level of acceptable performance, just one notch above being fired. To get the most out of their performance, a salesperson must be held accountable for a much higher standard. Management hires the best salespeople they can find and then accepts whatever they produce as all that can be expected. After all, they hired the very best professional salespeople in the market.
With all of the time demands surrounding management, it is difficult to consistently hold salespeople accountable. When there isn’t enough time to take care of their demands, salespeople are most often the ones neglected. After all, they are professionals, doing everything they can do to increase sales. The people responsible for bringing profit to the company are left to their own devices, while management deals with things having far less impact on the bottom line. Picking up pennies, if you will, while they trip over dollars. Within most business organizations there are three areas that have an impact on profit: sales, operations and administration. Management must keep administrative overhead within an acceptable range in order to see a profit. Production, or operation costs, must be kept in check to hope for a profit. The most direct impact on profit and loss is found in the volume of profitable sales. One sale can make the difference between being in the red or in the black at year-end.
Here are three areas where management can do a much better job with their salespeople. It doesn’t take as much time as you might believe, and is far and away the most profitable time that management can spend with any of their people.
- Hold salespeople accountable for achieving realistic, achievable and challenging goals. These goals should be broken down into weekly, monthly and annual increments. Think about it. If a salesperson reaches their weekly goals, then they will automatically reach their monthly and annual goals. Don’t make all salespeople’s goals the same. They should have relevance to ability, product and territory.
- Monitor the daily activity of your salespeople. I’m not talking about micro managing them. What I am suggesting, is that you set daily activity goals and have them report their performance on a weekly basis. Activity refers to those steps of the sales process necessary to make a sale. If a salesperson is not achieving a certain level of activity, they will never achieve their sales goals. Hold them accountable for the daily activity required to reach their goals. Sales success requires both skills and activity. If they are not doing the activity, it doesn’t matter how skilled they are.
- Pay your salespeople based on performance. There are typically three ways to compensate salespeople: salary, commission or a combination of both. A salary does not promote increased performance. A salary promotes just showing up for work and doing as little as can be expected to keep from being fired. A commission is just the opposite. It promotes unlimited performance. Sometimes it is necessary to compensate using both a salary and a commission. If this is the case, keep the salary low and put the majority of the compensation on the commission side. By doing this, you are holding your salespeople accountable for providing an income for their families.
Everyone needs to be held accountable in order to achieve their full potential. We see it in sports, in raising a family, and in politics. Accountability is one of the basic principles of the universe. Accountability is not just “being there” for your salespeople, it requires active participation and involvement. Accountability requires the application of two basic principles, ASSIGN and REPORT. Don’t think for one minute you will ever achieve maximum profit potential from your salespeople in the absence of accountability.