“When you do the same things again and again, the results get better”, it is a very deep statement. But it was useful to me in a different way. Last week, I happened to do the same thing, watching “Wolf of wall street” again and what I realised has been game changing. I was able to understand the real potential of a dynamic sales team in an organisation and the impact it can deliver.
Sales is a profit-center. It doesn’t matter how good your manufacturing operation is or how cutting-edge technology is or even how forward thinking your organisation’s management techniques are but at the end of the day all that matters is whether your sales team is able to bring in revenue or not!
Bringing revenue has never been an easy job; it has always had its challenge but the major problem faced by an organisation level is when the overall financial year’s sales numbers are not met. This has cascading effects in the valuation, share price, confidence among investors and other organisational aspects. And therefore, sales targets are sacrosanct.
The crux of the problem has always been the same be it B2B or B2C. And it is to understand:
- What are the factors that drive sales performance?
- Why do certain sales teams meet or exceed targets while others don’t?
- The last and the most important is: Can we proactively identify such teams, to create opportunities to improve performance or refine outlook?
Answering these questions can help sales management plan for the potential opportunities and when these are in the form of thumb rules it becomes a magic wand!
With this blog, I put forward five simple ways by which your organization can understand your sales team and the thumb rules that can get you the best quarter ever!
1. Rely on historic performance
Prior period performance is a dependable indicator of current performance. From experience we have realised that almost 50% of underachievers tend to perform poorly in the coming quarters as well. Therefore the key intervention area would be the teams that have consistently performed poorly over the previous sales cycles.
2. Meet a minimum of 25% in the first month of the quarter for meeting the target
Most of the time, sales teams typically deliver approximately 4X of their targets during the first month of the quarter. In another words, anything less than 25% of target attainment in the first month significantly increases the chance of underachieving. Therefore, during the first month of the quarter, management can intervene with teams which have achieved less 25% to decrease the salvage.
3. Go for smaller valued opportunities
Yes, excellent performers always target a large number of smaller opportunities and a large value of short term opportunities in order to achieve their target. In another words, they are not waiting for the big fish to fall in their nets but rather are attacking the smaller ones to get close to their target.
4. Maximum discounts better conversions
Excellent performers always give substantial advantages in the form of discounts and first-pick, to their clients/customers and a key aspect of their achievement profile is that they have lower returns when compared to poor performers. And therefore if you see your sales team provides lesser discounts ask them to try their best as it gets you the best of customers. In our earlier experience working with a fortune 100 Global technology company, we have seen that their best performers were providing higher (50%+) discounts.
5. Never increase plan by more than 10% for underachievers
When the plan is increased anything more 10% from the last years plan there is higher chances of poor performance. There it is always a wise decision to increase plan based on the previous quarter performance as there is a natural fear that hits the sales people when they see a plan increase anything more than 10%.
These 5 new methods don’t require you to ramp up your sales team size as we understand that increasing sales team size doesn’t necessarily increase revenue and moreover, it just increases the cost of operation.
These can be your simple mantras for getting started with your sales team assessment and for better performance.
Contact us if you are looking for help with your sales effectiveness. In my next post, we will delve deeper into the approach that we have followed to arrive at these thumb rules.
By Alagiri Samy, Analytics Consultant, BRIDGEi2i