how to set sales target

8/9/2019 How to Set Sales Target

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Setting Sales Targets & Measuring Performance Page number 1 of 23

Copyright Rhema Group 2008, RC M SA G SP 1

Setting Sales Targets and MeasuringPerformance

- Models, Guidelines, Checklists and

Processes for agreeingPerformance Measures

and Measuring Performance -

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The Performance Management Process

Outlined below is a seven step model for managing a sales person’s performance.

Steps one to three cover how to get performance measures and objectives.

1. Discuss and agree core areas

of the sales job/role

2. Identify and agree

on the assessmentcriteria for each core

area

3. Agree andwrite down theperformancemeasures for

each core areataking intoaccount theassessmentcriteria

4. Agree appropriatemonitoring methodsand frequency

5. Provide regular,specific feedback onperformance, both

positive and negative

6. Identifyproblem areas andconsiderappropriate

response

An environment of: Open and honest dialogue Mutual respect Encouragement and praise

7. Counsel, coach ortrain the individual toovercome the problemor to build on theircurrent, goodperformance


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Identify the Core Areas of Responsibility

Definition

A core area is an ongoing and significant part of the sale’s job or role. Most sales jobs have betweentwo and six core areas. They are generally derived from a list of primary responsibilities or

accountabilities on the job description.

Example

Job Title Core Areas

Field Sales Person 1. Generating Sales Revenue

2. Account Management

3. Territory Management

Process Steps:

1. Look at the Job Description, and the primary responsibilities/accountabilities, and ask the question, “What are the main parts of the sales job?”

2. Give each part a short title. For example: Generating Sales Revenue, Account Management,Territory Management etc.

3. Talk to the job holder to see if your perceptions of the core areas are aligned to his/hers.

4. Amend the list of core areas, if necessary, and agree on the final list.


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Identify & Agree the Assessment CriteriaDefinition

Assessment criteria are the outcomes, skills, measures, and results that you, as a Sales Manager want

to manage and evaluate.

Example

Job Title Core Areas Assessment Criteria

Field Sales Person 1. Generating Sales Revenues Sales per quarter. Number of new accounts. Customer exposure.

2. Account Management

Knowledge of major accounts. Breadth and depth of contact

within accounts.

3. Territory Management

Etc.

Quality of planning.

Personaleffectiveness/productivity.

Achievement of territorytargets.

Process Steps:

1. Look at each core area, and ask the question, “What are the outcomes or

skills that I want to manage and evaluate?”

2. Identify the essential assessment criteria for each core area—between one

and four. Have as few as possible, but do ensure that you cover all the

essential aspects of the job.

3. Meet with the job holder, and agree on the assessment criteria that will be

used to evaluate his/her performance.

4. Refine and finalise the assessment criteria.


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Agree & Record the PerformanceMeasures

Definition

A performance measure is a written statement, which expresses in a specific way the standard ofperformance that will be considered effective by the Sales Manager.

Categories

There are three types of performance measures:

Quantifiable - Performance measures that can be expressed in

numbers, percentages, time, etc.

Behavioural - Performance measures that describe the desired

behaviour of a sales person.

Subjective - Performance measures that refer to the

subjective judgment of relevant others eg customers.

Start performance measures with the words “Considered Effective When (CEW)….”

Example

JOB TITLE: FIELD SALES PERSON

KEY AREAS AND ASSESSMENTCRITERIA

PERFORMANCE MEASURES

Generating Sales Revenue:

Sales per quarter. Percentage exposure.

Number of new accounts.

CEW you generate sales revenue of £50k per

quarter and you add 2 new customers each month,such that sales targets are achieved and you arenot exposed more than 20% to any one customer.

Account Management: Knowledge of major accounts.

Breadth and depth of contact.

CEW you can demonstrate comprehensiveknowledge of your major accounts such that thedecision makers in the account are convinced youunderstand their business.

CEW you maintain a depth and breadth of contactwith your major accounts such that you are notvulnerable to changes in personnel.

Territory Management:

Quality of planning.

Personal effectiveness andproductivity.

Achievement of territory targets andobjectives.

CEW you write territory plans that clearly

demonstrate your understanding of territoryobjectives and the critical activities needed toachieve them such that your plans achieve theobjectives.

CEW in managing your territory you spend therequired time in front of customers on a dailybasis.

CEW when you create annual, quarterly, monthlyand weekly plans to deliver all your strategicobjectives and operational targets in the time-frames planned.


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Three Types of Performance Measures

Quantifiable performance measures focus on end results.These measures can be expressed in time, quality and quantity.

Methods of Writing:

Use numbers, percentages, deadlines, statistics, etc., to spell out the precise

standard you wish to see attained. This can be done by explaining CEW – ie the

Jobholder is ‘Considered Effective when…’ – or by using SMART – ie spelling out

Specific and Measurable goals, which are Achievable (and Agreed), and Relevant

(and Resourced) and Timed (or Trackable).

Behavioural performance measures focus on how results are achieved. These

measures describe the desired behaviour of an employee. They are evidenced by

behaviours you have seen or heard. Behavioural measures describe the skills,

activities, or methods used to obtain results.

Methods of Writing:

Describe the behaviour you wish to see/hear or do not wish to see/hear. It may

also be helpful for you to describe the behaviour of someone who does this task

well.

Subjective performance measures refer to the perceptions of other people.

These measures describe the desired feedback you want from relevant others,

such as customers, co-workers, other Managers, etc.

Methods of Writing:

Identify who will be the judge(s) of the person’s performance in the area

concerned, and describe the feedback you want to receive from him/her.

1

2

3


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Use of Performance Measures

Different Aspects of a Sales Job where Performance Measures might be

used

Ongoing Job – Performance measures for core areas of the sales job.

– Example: See previous pages – using CEW is useful here.

Additional Projects – Performance measures for projects that are in addition to the core job.

– Example: “Carry out a complete customer review using the new system and submit the

key results to me by October 13th - using SMART is useful here.”

Continuous Improvement – A performance measure that is designed to ensure that specific tasks

are done more frequently or more effectively.

– Example: “Considered effective when you actively look for ways to improve your personal

effectiveness and efficiency, and when you come to me with specific ideas to

achieve this objective.” – this could be SMARTened by asking for 2 or 3 ideas by

the end of the year.

Teamwork – Performance measures that relate to the contribution an individual makes to the sales

team.

– Example: “Considered effective when you work in co-operation with other sales team

members, and you are willing to help other sales people as needed.” – sometimes

a more general and discretionary statement such as this helps here.

Personal Development – Performance measures that relate to a sales person’s growth in knowledge

and skills. Often it pays to encourage the sales person to take responsibility themselves to pursue

this goal, and to demonstrate not only the acquisition of the increased knowledge and skills but also

the results of their application to the job.

- Example: “Considered effective when you take steps to increase your knowledge of

market and customer research.”


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Measuring Joint Accountabilities

Sales Team Performance and Joint Accountabilities:

The effective functioning of sales teams depends upon the clear assignment of an individual sales

person’s responsibilities and actions.

Success increasingly requires co-operation, commitment and action co-ordinated across traditional

authority boundaries. Clear identification of roles, responsibilities, and actions are essential if business

goals are to be met.

In both situations, “collective responsibility” must be broken down so that each sales person clearly

understands what is expected of him/her. For example:

Identify what achievement of the goal would look like.

Identify the sales people required for successful goal completion.

Discuss and define the roles, responsibilities, and accountabilities of all the sales people involved.

- Break the task down into measurable actions.

- Gain commitment to actions and timeframes from all the sales people involved.


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Team Performance and JointAccountabilities

Sales Person A

1.2.3.4.5.

Sales Person B

1.2.3.4.5.

Sales Person C

1.2.3.4.5.

5. Hold individuals accountable for carrying outtheir personal actions.

4. Agree on, and gain commitment to, actions from

individuals.

1. Define the success criteria for the task.

2. Define the roles, responsibilities and

accountabilities of all involved.

3. Break the task down into measurable actions.


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Achieving Maximum Leverage

Setting performance measures that combine high business impact with high personal influence will enable you to achieve maximum leverage.

HIGH

High business impact/

Low personal influence

High business impact/

High personal influence

BUSINESS

IMPACT

Low business impact/

Low personal influence

Low business impact/

High personal influence

LOW PERSONAL INFLUENCE HIGH

How?

“Improving all customer service levels” is a performance measure that has high impact on

business results. However, it is unlikely that any single sales person can influence the

achievement of such a goal.

The key is to ask yourself, “How” can this sales person influence the improvement of customerservice levels?”

The answer will form the basis of individual targets to increase your influence over the

achievement of a key business objective.


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Why?

Focus objectives and measures on the desired outcome.

A sales person may have high influence over some areas of work, but these areas may have

little impact on business results.

When you consider setting an objective, or measure, ask yourself:

“Why is it desirable?” “What do you want to the person to achieve?” “Will it support the

achievement of sales goals?”

By asking why or how , you will be in a better position to prioritise objectives and measures for

sales people so that they will have high business impact and high personal influence .


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The Benefits of Agreeing Performance

Measures Good performance measures Impact internal/external customer perceptions.

Create open communication and a stronger relationship between sales people and sales

managers.

Eliminate sales people’s “blind-spots” and provide the starting point for self-improvement.

Bring performance issues out in the open.

Clearly identify the method of measurement, so that monitoring can take place openly.

Ensure that problems, in the area of personal skills, can be tackled as part of the “norm”.

Allow relationship issues to be raised and handled more objectively.

Ensure that development needs can be openly discussed and accepted by the sales person.

Clarify how the job should be done (not just the end result).

Provide a constructive method for raising sensitive behavioural issues.

Bring under control, and improve, behaviours that may have previously eluded the Sales

Manager.

Help the organisation to develop a culture of co-operation, support, and partnership, which

is reflected in its dealings with customers.

Prevent the build up of frustration and confrontation between the Sales Manager and the

Sales Person.

Reduce the need for performance improvement coaching or counselling sessions.

Ensure that behavioural and attitudinal issues do not deteriorate to the detriment of the

business

Reinforce company culture and values—“the way we do business”.


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Emphasise that it is very often the behavioural aspects of performance that differentiate

good sales people from outstanding sales people.


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Monitoring and Measuring

Performance Using Joint Calls

Joint calls provide a tremendous opportunity for the Sales Manager as coach/mentor to view

the Sales Person in action and to assess:

The quality of pre-call preparation.

The structure and content of the call.

The level of selling skills used.

The results of the call.

The sales person’s development needs.

This document provides a checklist and guidelines for carrying out a day of joint calling by the

Sales Manager with a Sales Person.

It consists of:

Joint Calling Checklist.

Joint Calling Assessment Sheet.

As a Sales Manager use these tools to improve your monitoring and measuring of your Sales

People’s performance.


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Joint Calling Checklist For The SalesManager

PRE-CALL

Explain purpose of the day of joint calling to the Sales Person.

Discuss the day’s plan.

If relevant, refer to any previous visits and objectives set for the day.

Discuss the customers to be visited (one at a time before each joint call).

Discuss objectives of the call and how the Sales Person is going to achieve them.

Identify what problems the Sales Person is likely to encounter if any.

Seek any background information to the call and the customer relationship.

Agree how the Sales Manager is to be introduced and his/her role.

DURING THE CALL

Avoid being drawn into the sales call or sales presentation. The main purpose of the Sales

Manager is observation of the structure of the call, the selling process and Sales Person’s

sales skills.

Assess the key strengths and weaknesses and have evidence.

POST CALL

Ask the Sales Person what they think they did well and also what they could improve upon

for next time.

Be specific in praise; `that was good` is not specific enough.

When asking for improvement, be clear about what you want to see improved.

Prepare for the next call and look for improvement.


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Setting Sales Targets & Measuring Performance Page number 16 of 23 Copyright Rhema Group 2008, RC M SA G SP 1

PITFALLS TO AVOID

The time you spend in the field with your Sales Person must be seen as a period of work

and not just a visit.

Never rob a Sales Person of a sale.

Never use your own equipment, always use his/hers.

Never boast about how easy you find selling or what you have achieved in the past.

Don't be afraid to invite feedback from your Sales People.

Never dodge difficult customers.

Never be late for an appointment with your Sales People. If you are you automatically

allow your Sales People to be late.

Never regard this coaching activity as an interruption to your work. It is the most

essential part of it!

END OF THE DAY

If possible, break both during and at the end of the day for a chat. Encourage the Sales

Person to talk about any difficulties or problems they are having.

Allow the Sales Person to do some self analysis against the day's plan. Was the plan

achieved?

Follow the feedback rules. Praise successes.

If a Sales Person's plans did not work ask him/her why. Check to see if all preparations

were made.

Both of you should make notes on any areas for improvement. The day should act as a

reminder for future calls you may make together.

Be fair and objective. Aim to get the Sales Person’s agreement to feedback.

Check what the Sales Person is doing the following day. Make sure s/he has planned

properly for the day’s selling activities in the light of this day.

Set clear objectives for the Sales Person to achieve before your next joint calling day

and make sure that both of you have copies of these.

Finally thank the Sales Person and leave him/her with a “well done”.


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Setting Sales Targets & Measuring Performance Page number 17 of 23 Copyright Rhema Group 2008, RC M SA G SP 1


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Joint Calling Assessment SheetUse this sheet to plan and assess joint calling days.

Day/date

Area for visits

Focus for the day (Agree with Sales Person eg. To practise planning calls, structuring calls,closing skills etc.

No. of calls to be made in the day and objectives of each one

Customer/Prospect How visit obtained eg.e-mail, cold call, tel. call,networking etc

Call Objectives


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Individual Call Assessment

NAME OF CUSTOMER/PROSPECT CONTACT NAME

Networking Coldcall

TelAppoint.

E-Mailinfo

Research—about customer’s business and needs (Things to mention and highlight)

CALL STRUCTURE

Structure of the call. Introduction

Identifyneeds/problems/futureplans

Agree priorities

Write down the orderin which each elementwas covered.

Advise on solution (s)

Features of Solution(s)

Tick the boxes ifcovered.

Benefits of proposedsolution

Handling questions and

objections

Proposing next step


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Closing/gaincommitment to nextstep


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SELLING SKILLS

Identify needs: Which were the questions that gained the most useful information?

Listening skills: Were the customer’s replies noted & acted upon?Note down any that were and any that were not.

Features of Product/Service Solution(s): What features of what products/serviceswere presented to the customer?

Benefits of Solution(s): What product/service benefits were stressed?


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Gaining Commitment: Was there a genuine commitment to the nextstep from the customer?

Talk v Listen : How much of the call was taken up with talking andlistening by the sales person?

Talk %

Listen %

Given the customer type was the % about right?

Use of support material: What sales support material was used? Was itused in a timely and effective way?

Handling questions objections: List the questions and objectionssuccessfully dealt with and those that

were not and the reasons.


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Next steps: Was the next step agreed a suitable one?

Closing: Detail the statement or question that gained commitment and closedthe call.

Behaviour/mannerisms: As an observer comment on any issues thatwere obvious during the interview that

helped/hindered the Sales Person.

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