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It’s July – Do you know where your sales are?

July 19, 2016  |   Performance Management,Uncategorized   |     |   Comments Off on It’s July – Do you know where your sales are?

CompensationSummer is a time of fun and adventure, a time to kick back and enjoy family and friends during vacations and long weekends. Lazy days on the hammock reading a book…. Sounds great, but here’s a dose of reality:

The sales year is half over, Q2 is closed out and there are less than six (6) months to reach your 2016 quotas. How is the year going? If it’s going great and you are 50% or greater to your quotas could it be even better? If sales are behind plan, what can be done to push things forward? All too often, sales management teams default to developing mid-year sales incentive plan changes to reinvigorate sales. However, the fallacy that throwing more money at the problem at best pays sales teams more for the sales they would already be making and at worst becomes a huge distraction to the team and actually prevents sales from closing deals that they would have had they stayed focused.

Professional sales teams often find temporary incentives or “SPIFs” a slap in the face as they don’t address the real obstacles they face to finding and closing deals. Now is the time for sales management to harness the results of the first six (6) months to quickly and decisively make course corrections to ensure 2016 sales targets are met. Sometimes the most obvious opportunities are hiding in plain sight. Read on for two (2) proven ideas on how to capture more sales without changing the incentive plan or making any other significant investment of time or money.

Mine Your Base

Now is a great time to take stock of how well your sales team has captured renewal and expansion business at your current customers. Sometimes, in the excitement of the new year, the focus communicated at sales kick-off is all about expanding the business via customer acquisition – landing new logos or selling expansion products. But what may be overlooked is the potential business left on the table at current customers.

Various factors can dissuade your sales team from vigorously pursuing sales at current customers. Whether it’s because all the carrots have been put behind new sales or because it is better to “let sleeping dogs lie,” often too little focus is paid to the current customers. On the surface these would seem like the first sales opportunities captured in the year but the reality is often sales is hesitant to go back in and “poke the bear” for fear of finding out what is NOT going well with the customer or is uncomfortable negotiating a higher price for the same level of service. These “fears” are often legitimate concerns and present a great opportunity for sales management to provide advanced support to their sales teams to push past these obstacles.

Sales managers should collect, via sales operations or direct from the field if necessary, a report of the status of all customers that were in the base at the start of the year and their sales activity in 2016. A funnel update meeting should be held with the sales team (this should include everyone that accesses the customer such as account manager, inside sales, systems engineer, customer service) for the express purpose of categorizing the current customers to mine for additional opportunities. The following situations highlight missed opportunities that are ripe for sales:

BCR-Observed-Sales-Activity

Repeat the Success Route

Six (6) months of data is available to sales managers to mine, identify and exploit what has been the most successful sales pathways this year. This may come in the form of products that are performing well, pricing and contracting structures that are leading to high close rates or the successful deployment of sales tools that your organization is investing in such as digital selling platforms, inside sales or try before you buy programs. Now is the time to take a closer look at close rates for these factors and analyze how deeply these tools have been deployed across the organization.

Gathering feedback directly from the sales force about what is not working in their efforts to close deals and why can not only help the organization direct their sales support investment but also leads to greater engagement from the sales team. In the traditional approach, when a new strategic product is not selling well, management will suggest a SPIF to drive additional sales. However, what management may not understand is that sales is struggling to identify customers that are interested in hearing about the product or that contracts for the new product are difficult to get through legal. Understanding the root cause for lagging sales is a less expensive, more effective and longer-term solution than paying money on top of the current incentive plan. Not to mention, when the SPIF is taken away the message is ultimately that this product is not as important as it once was.

Still want to change the incentive plan?

No doubt there is often a cultural bias towards believing that incentive plans alone drive behavior. Often, adjusting the incentive plan to drive mid-year sales is a mandate, not an option. If that is the case, conduct due diligence on what areas of the existing plan are not currently paying out to their planned levels and consider those as your primary opportunities for plan enhancement. If you are not currently tracking a set of plan effectiveness metrics to identify this, now is the time to start. This doesn’t have to be an intensive exercise – a few key statistics can help you identify the holes in the plan that are opportunities to drive additional sales:

BCR-Plan-Effectiveness-Metrics

Each of these metrics can be drilled down from the macro level to find the niche of opportunity. For example, perhaps quota attainment is a normal bell curve in aggregate but when cut by tenure of the sales reps or vertical specialists you will uncover specific populations that are struggling. Another telling dissection of the data is to uncover whether new business or renewal sales are delivering the most incentive.

In Summary

The best-run sales organizations realize there’s much more to driving sales than the sales incentive plan. Hopefully this gives you some ideas on quick hits to identifying where to find sales to help push through a mid-year slump without blowing the incentive budget.

Contact Us

BCR has experience in working with organizations to review and assess their sales practices and policies. Reach out to us if you should want to explore how we can assist you further in ensuring your organization is taking advantage of sales compensation plan metrics.

Written by: Sheila McCarthy, BCR Consultant

BCR is a local, minority-owned firm with more than 25 years experience in serving non-profit, public, and privately held entities in the key areas of Benefits and Compensation Consulting, Performance Management, Human Resource Organization Development, and Human Resource Information Systems and Processes.

 

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