How satisfied are you with your sales incentive plan?

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How satisfied are you with your sales incentive plan?

April 28, 2011 in Coaching, Strategy, Success, Tips

A good sales incentive plan rests on a fundamental set of design principles that reward the right behaviours, optimise sales effectiveness, and maximise the return on incentive dollars.

Specifically, a good sales incentive plan design:
•   uses performance metrics that are aligned with the company’s overall strategy;
•   supports and is consistent with the overall sales force strategy — its job roles, available skills, selling processes,    internal culture, etc.;
•   is mechanically sound in its design elements; and
•   can be administered efficiently

If not well designed however, there may be issues or challenges within each principle which could limit effectiveness, waste new investments or lead to unforeseen consequences that would limit sales growth, especially during these volatile times. According to the 2010 Deloitte’s Strategic Sales Compensation Survey less than half of over 250 participating sales leaders (only 43%) were satisfied or very satisfied with their sales incentive program. The remainder were, somewhat, unhappy with their current plans.

Incentive programs are very important retention strategies; however we have noticed a shift in the configuration of incentive plans in recent times. A number of our clients, in addition to their monetary incentive plans, are now including professional, external one-on-one coaching as an incentive offering to their sales people and leaders. We are seeing a shift from purely monetary reward as the whole incentive offering to an incentive plan that also includes professional development.

So is your sales incentive plan sound?

If sales incentive programs are to be effective, all the factors that affect behaviour must be recognised, including: motivators, values, skills, recognition, an understanding of the company and teams goals, and the ability to measure progress. So, consider this:

1.   Do your metrics help drive the company’s strategy?
2.   Is your plan a good fit for your sales organisation?
3.   Is your plan “mechanically sound”?
4.   Can you administer the plan with existing people, processes, data, and technology?

Companies often turn to sales incentive programs to counter failures in meeting targets, poor behaviours or performance issues, unengaged employees, poor morale or attitude, high turnover or loss of talent, or increases in expectations from management. Many companies mistakenly assume that what works for one organisation will work well for all organisations. Companies often attempt to create incentive programs without thinking in detail about how each program feature will best suit their targeted audience.

For example, one software manufacturing company had a sales incentive plan whereby its salespeople could earn twice as much commission selling old solution than if they sold the new software solution, yet the manager wanted to increase sales of the new product. You can see where the sales team were going to give their attention to. Issue: company wants sales growth from new product but sales people are selling something else. Fix: rearrange how the salespeople are incentivized to achieve the behaviour and results you want. It looks so obvious, however companies make these mistakes every day. This is an easy fix if you are selling product in a transactional climate.

However, given these ever changing times and the significant shift from transactional product selling to more complex value added partnership selling, especially when many businesses are looking for more profitable relationships, many sales teams’ incentive plans are not keeping pace. Often based on simplistic transactions and volume, previous sales incentive plans do not account for the many B2B (business to business) sales results which are now based on the efforts of a team not the individual. Selling in complex B2B spaces are often the result of collaborative efforts, so how do you reward results often as the result of many?

The 2010 Deloitte’s Strategic Sales Compensation Survey identified that ‘effectively executing today’s more complex sales approaches requires key sales team members to work together; this could be a key success differentiator for companies in the next five years. But the right compensation plan balance between individual and team-based rewards remains hard to strike.’ Deloitte reported that around two-thirds of respondents are using some form of team-based selling as part of their sales model. But respondents still have concerns about how well their incentive plan is driving team selling. Only 41% feel their plan is driving team behaviour “well” or “very well.”

The “messages” the sales incentive plan design delivers about the company’s strategic priorities should not be contradicted by other sales elements the company has in place — for example, if there are unfocused role definitions within the sales team or little emphasis on attracting or retaining the right sales team members. This is why getting your sales force design right is critical.

The Survey also reported that sales incentive design must be structured so that its metrics, targets, commissions, bonuses, eligibility rules, etc., all interact sensibly and with as little complexity as possible. Poorly set quotas in a fast-moving and unpredictable marketplace can create either overpayment “windfalls” for sales team members – based more on market dynamics than their own efforts – or unrealistically high expectations that can keep morale at a low level. Moreover, the risk is exacerbated by the increasing popularity of building estimates of “potential” into territory or account quotas. While the idea may make good business sense, it is difficult to create estimates with precision, and therefore increases the chances of significant errors in quota levels. The following advice was highlighted as a result of the survey findings:

Take a step back. Evaluate plans against the four principles. Invite practitioners from Sales, Finance, IT, Sales Operations, and HR to look at sales compensation from all perspectives. Think through how investments in sales expansion and support should be productively deployed.

Consider retention. Think about which sales performers the sales team needs to retain — not just the current top performers, but also the “up and comers” who will make a difference to your company in the long-term. Perhaps create longer-term pay structures to keep them motivated.

Something more than Money
Consider offering coaching support to your sales team as part of your incentive plan. This will work especially well for high performers who are looking for something more and those “up and comers” who can really accelerate with the right guidance and support.

As mentioned we are seeing a shift from purely monetary reward as the whole incentive offering to an incentive plan that also includes professional development. So it’s true, even for sales people money doesn’t buy you everything.

Remember everybody lives by selling something.

Author: Sue Barrett, MD of www.barrett.com.au

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Time for reflection and recharging

April 21, 2011 in Emotional Intelligence, Tips, Wellbeing Support Services

With this holiday period upon us, many of us take time to rest from the busyness of our daily work lives and spend time with the people we love the most. Often time this space can allow us to reflect on our lives, review what is important to us and appreciate those close to us. For some they can simply feel exhausted and just which to lie still in time to recover for the next busy schedule.

With a 24/7 life style we can often get caught up in being ‘ON’ all the time however if we do not take time to rest and reflect we diminish our capacity to be and work at our best. The research is very clear that getting a good night’s sleep is critical to healthy brain and body function. The research is also showing that learning how to manage our thoughts and become more mindful is critical to our resilience; our ability to bounce back especially after setbacks.

The many people we work with on a daily basis via our training and coaching, are increasingly wanting to learn how to reflect, be still and be more resilient. We are being asked to teach more and more people how to meditate and become more mindful.

Rather than discuss the theories around reflection, meditation and mindfulness and have your thinking too much over this holiday break we would rather give you a small gift this holiday period – the gift of meditation which can hopefully bring peace and happiness to your busy world.

We have developed a series of short meditations for Leaders, Executives and Salespeople which form part of our series The Mindful Leader.

Meditation is a skill – a very valuable skill. The purpose of meditation is to heal and transform. The skill and practice of meditation has been in the realm of the human experience for thousands of years. Because meditation is a skill you can practice meditation anywhere at any time. In every moment you can chose to meditate. There are many forms of meditation ranging from seated meditations, silent meditations, walking meditations, guided meditations to prayer and living one’s life a in a state of continuous mindful meditation. Seated meditation is the most well known and practiced form of meditation.

This meditation is designed to help you look at possibilities and be aware that many opportunities are available to you.

Preparation: Sit in a quiet spot, preferably is a straight backed chair with your feet flat on the ground and your hands resting comfortably in your lap. Image you spine is like a stack of coins neatly placed on top of each other and your head is slightly titled forward in a restful but alert position. Take some deep breaths breathing down into your belly. Breathe in through your nose and out through your mouth finding a comfortable breathing rhythm. Then quietly read out loud the following guided meditation or have someone read it for you.

Exercise 3 – Seeing possibilities

Aware that I am born into a universe of infinite possibilities I breath in

Seeing possibilities in everything I breath out

universe of infinite possibilities

seeing possibilities

Focusing on my current state of mind I breath in

Aware of the possibilities that have made up my current state of mind I breath out

current state of mind

possibilities that make up my mind

Focusing on the contents of my mind I breath in

Aware of the possibilities that have made up the contents of my mind I breath out

contents of mind

possibilities that make up my mind

Aware of my current beliefs I breath in

Aware of the possibilities of beliefs I breath out

current beliefs

possibilities of beliefs

Aware of any beliefs that keep me from seeing possibilities I breath in

Reframing those beliefs so I can see more possibilities I breath out

limiting beliefs

reframing beliefs

Aware of any frustrations that keep me from seeing possibilities I breath in

Letting go of any frustration that keep me from seeing possibilities I breath out

frustrations

letting go of frustrations

Aware of judging others’ ideas and suggestions I breath in

Letting go of judgments about others’ ideas and suggestions I breath out

aware of judging others

letting go of judgments

Aware of judging my own ideas and suggestions I breath in

Letting go of any judgments I breath out

aware of judging myself

letting go of judgments

Aware that I am born into a universe of infinite possibilities I breath in

Seeing possibilities in everything I breath out

universe of infinite possibilities

seeing possibilities

This exercise is simply designed to allow you to stop and reflect so you are in a position to see possibilities. If you struggle with limited thinking and feel blocked this may help you see what is possible.

We welcome your feedback on this exercise and any other enquiries you might have in relation to developing the skills of mindfulness and meditation practice.

Thank you again for your support of loyal readership we wish you all the very best of this holiday period.

Remember everybody lives by selling something.
Author: Sue Barrett, MD of www.barrett.com.au

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Exceptional Prospecting and Social Media

April 7, 2011 in Call Reluctance, Communication, Prospecting, Self Promotion, Social Media, Social Sales, Tips

With social networking sites and the plethora of online data available, 2011 presents us with better quality prospecting and more qualified prospects. ‘Prospecting and Social Media’ was voted as the Number 4 Sales Trends for 2011. Business networking sites such as LinkedIn and Plaxo, and the emergence of Facebook and Twitter as business destinations, give the discerning business or sales person access to quality data where they can research key contacts with an organisation, as well as business activity. Then, when appropriate, they can use this data to make professional connections.

Smart business leaders and sales people are using social networking sites as tools to engage in better quality prospecting and improve conversion rates rather than just using them to make a list of prospects. These sites potentially make redundant, the concept of Cold Calling and the fear of prospecting and can help people become exceptional prospectors. So how do you get the best out of Social Networking sites when prospecting? Let’s look at the business phenomenon that is LinkedIn.

LinkedIn

For Business to Business prospecting, LinkedIn is proving to be a rich source of information, contacts, suppliers, prospects, referrals and clients. It has exploded in connections and content, and usage has skyrocketed in the last 18 months through its many features helping you get connected to the right people. It is the largest B2B social media networking group in the world. For instance my own LinkedIn profile and network currently can connect me with over 5,200,000+ contacts, imagine how we could all harness the power of these connections. So how do you use LinkedIn to help you prospect more effectively?

Step 1: Develop a sales plan, clear message and profile
Before you set up your LinkedIn profile make sure you have a clear sales plan which identifies who you need to be connecting with i.e. types of clients, suppliers, peers, industry sources and groups. Think about what you want to present by way of image, message and purpose i.e. what do you stand for? What do you do for people? Look at how you would like to position yourself as a business professional. Like websites, your LinkedIn profile is your professional resume online; it represents your professional brand. This is why you need to be clear about who you are, what you do and what you want to communicate to a broad audience. What you do, what your company does, what you represent, people are likely to make up their mind about you based on what they see and read about you. Your LinkedIn profile should form part of your sales and marketing strategy.

Step 2: Join LinkedIn
Get your profile up and live. It’s easy and it’s free – go to www.linkedin.com and get started. There are also various levels you can subscribe to enhance your profile and get you better connected with search features and other options. These extras come with a monthly fee attached. Begin by using the free access option and try it out before committing to upgrades.

Step 3: Join LinkedIn Groups
There are many and varied LinkedIn Groups you can join. These groups provide people with forums to discuss and exchange ideas and opinion, as well as keep up to date on the latest trends, ideas, innovations, etc. It’s also where buyers are increasingly looking to research suppliers before they buy. They are looking for what others say about you and your products or your industry. They can compare you with your competitors’ offerings. In these groups you can listen to what your customers are saying before they even decide to talk to you. Your sales strategy should guide you as to who you should be in contact with. What types of groups would be useful for you to belong to? For instance if you are a Learning and Development specialist, Engineering sales professional, Environmentalist or Procurement Manager then there are groups focusing in these spaces and many more. But do not limit yourself to the narrow bandwidth of your own expertise. Often looking outside your comfort zone can give you access to new ideas and contacts as well. These groups allow you to listen to your community, suppliers, clients and other interested parties. This gives you access to a wide range of people. See Barrett Consulting Group LinkedIn group as an example. A word of caution: Do not blatantly self promote or advertise your wares in these groups; it will not go down well. If you try to blatantly self promote and prospect in these groups you will be shunned and often kicked off the group.

Step 4: Start to connect
The best way to build up your network of contacts is to invite people you know to connect with you. This way you can begin to build up direct connections who, in turn, can then give you access to people outside of your direct network. You can often look at your contacts list of connections and you can see who might be good to make contact with. It’s advised that you don’t contact someone you do not know directly without some form of personal connection or link; instead, you can seek an introduction through one of your direct contacts. Sending out LinkedIn requests to people at random will not be seen as good business and will be deemed inappropriate or spam by many and may affect your reputation. It is also wise to be discerning about which connections you accept as well. Don’t just accept invitations from anyone, make sure you find out why they want to connect with and how you can be of best service to each other.

Step 5: Identify and Research Your Prospects
If you are already connected on LinkedIn and you know what types of people you need to prospect to you can look through your contacts lists to see who is there. You can also develop a list of names of people who are in your target market via business websites which often have names of key contacts or business news sites and industry magazines which often feature key decision makers. Your own CRM or client database should have lots of names you need to speak to. And of course you can buy lists once you are on LinkedIn and begin to research your prospects. In the upper right hand corner, there is a search box with a pull down menu. Click on that and you’ll see six options (people, jobs, companies, answers, inbox, groups). Click on “people” and enter the prospect’s name. You can see a lot of information about prospects, the groups they belong to, what they are interested in, their experience and knowledge, etc. You can use a prospect’s background to develop questions that relate to their area of responsibility. It will help you to develop very clear Valid Business Reasons (VBR’s) when calling them. Make sure you know how to get prospects to talk to you.

Step 6: Start Prospecting
Develop a list of 20 to 40 prospects per week and then make contact via the telephone as you would normally do. Use relevant VBR’s to help you connect. Pretty soon you will be making contact with the viable prospects and on your way to making more sales. If you are still not comfortable calling people via the phone you can use Linkedin as a prospecting option however make sure that you still use a VBR in your message or invitation to them.

Summary
Does this mean you will learn everything about a person via their profile or that you take a carte blanche approach to prospecting? NO. We will need to be mindful about how we go about making contact as we will still need to engage in skillful prospecting activities to position ourselves effectively. Remember information is not POWER it is potential power. LinkedIn and other social media networks are not the only sources for prospecting but they certainly can help you achieve peak performance in prospecting.

With clear sales plans and well defined prospect profiles there’s no excuse NOT to prospect effectively. 2011 will be about a Total Quality Prospecting environment.

Remember everybody lives by selling something.

Author: Sue Barrett, MD of www.barrett.com.au

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A Time for Reflection and Renewal

December 16, 2010 in Attitudes & Behaviours, Success, Tips

As this year comes to a close, I find myself reflecting on the last 16 years in my own business. A lot has changed, yes, but many things have remained the same too. On 9th January 2011 my business will be 16 years old.

While anniversaries and birthdays are celebrated differently all over the world, a common thread is that they are often marked with a celebration or a rite of passage. So, to mark our 16th year in business, we would like to share with you 16 key lessons we have learnt since the business began. While there are many more than 16 lessons learnt, we thought it fitting to have one for each year.

Lessons learnt over 16 years

Values
Define your values and what you stand for; what is acceptable and what is not in your business and for you. Make your values a part of your daily work habits, your charter and your selection process when hiring people. It helps you to know when to say ‘yes’ or ‘no’ to trivial or important matters.
Leadership and Humility
Central to management and leadership are trust, respect and openness; listen and learn from your staff, clients, mentors and guides and adjust yourself on your journey to become a proficient, effective leader; build a bridge and get over yourself – don’t let your ego get in the way; follow through; don’t assume anything; be available and responsive; it is important to remember that helping others helps you.
Strategic Planning
Is your vision viable? Can it make money and be self sustaining? Once you have decided to move forward, build a plan. From top to bottom and back up again – strategic to tactical. Review it on an ongoing basis not just once a year; involve all staff in its development; make it actionable, accessible and relevant to every role in the business.
Pick Your Counsel Wisely
Find those people who understand you quickly and easily, who can paraphrase and verify what you have just said. They should bring in different perspectives and help you see links and gaps you may be unaware of. Don’t take them at face value – check that their ideas are valuable and valid – put their comments through the ‘fact versus effect’ filter to see if they are being genuine or not. And don’t pick too many at once because listening to too many people only creates confusion and indecision.
Managing Setbacks
Always confront and resolve issues straight away, as they only get worse when ignored. Never see yourself as a ‘failure’, and always try to learn from your mistakes. You can never fail and succeed as a whole person: you can only fail or succeed at the things you do. Don’t be afraid to take risks – instead take calculated risks, so if your new idea or initiative back fires you haven’t lost everything in the process.
Teachable and Transferable
Build your products or services so they can be easily taught and transferred to your team, and in turn, they can easily sell and deliver them to your clients directly or via channels. And make sure it is always in language your clients can understand.
Trust
Even when things are not going the way you want them to you need to trust your vision and have faith in yourself and others that you will come through. Remember, people buy from people they trust. Trust supersedes like.
Passion
Without passion you just won’t have enough energy or desire to make business success happen. Staying focused is crucial. Think as big as you like then set clear goals and ‘see’ yourself achieving them.
Self Mastery Rather Than Success
If we focus on enjoying rather than proving ourselves we value mastery rather than success, effort rather than outcome, and the relationship rather than approval. Our journey to self mastery is ongoing on every level.
Your Health and Time to Reflect
It’s worth it. Look after yourself and make sure you take care of the whole person – exercise, diet, rest, get variety, take holidays, etc. Because if you don’t then you are no use to anyone especially yourself. Take at least 5 minutes each day to sit quietly and reflect.
The Principle of Exchange
We all exist because we are exchanging something of value. Knowing how to communicate that value so others may appreciate and understand what you bring is critical. Be clear about the value you bring to any relationship whether it is business or personal otherwise you may create confusion about its true value.
Worthiness
We are all worthy, whatever our station in life. Our worth is not measured by what we do. We are worthy just because we exist.
Creativity and Innovation
Create something new, think outside the box, challenge prevailing views and attitudes, and don’t let yourself be bullied. Read outside your area of expertise to see how others learn, lead, make decisions, function and work – look at how it may apply to you and your business. Learn to be flexible and open minded. Trial new initiatives and see if they fit your business.
Application Rather Than Theories
Don’t get hooked on only one way of doing things as most theories don’t hold true in real life. You need to be able to use a mixture of ideas, theories, processes and models. Always have a full ‘kit bag’ of ideas, processes, resources, etc. that you can draw upon, and learn how to use them when you need them in life; take bits and pieces and apply them; trust your common sense; be prepared to make mistakes and learn from them.
Get a Reputation
If you don’t have a reputation, align yourself with someone who does. Or put your business up for reputable awards i.e. Small Business Awards, etc. It’s worth it just for the audit process itself. And, who knows, you might even become a finalist and maybe even win. There’s nothing like an award to elevate your reputation.
Courage
Check ‘what am I here to do?’ and have courage in the face of adversity – stand up for what you believe in. Remember, courage doesn’t always roar sometimes it’s a little voice inside your head that says I’ll try again tomorrow.

To all our readers, supporters and business colleagues, thank you for your patronage. The team at Barrett wish you all the very best for 2011 and look forward to sharing many more insights, research, findings and tips on how to lead an honourable, healthy and prosperous career in sales.

Remember everybody lives by selling something.

Author: Sue Barrett, www.barrett.com.au

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We want more than a script

July 13, 2010 in Attitudes & Behaviours, Communication, Customer Service, Prospecting, Sales Relationships, Sales Skills, Sales Training, Tips

Hundreds of thousands, if not millions of sales people around the world use sales scripts. Used properly, sales scripts act as scaffolding or bridgework to earn us the right to have a meaningful discussion with our prospecting customers, members, donors or subscribers. The sales script is a well constructed set of guidelines that support us when we prospect.

Good sales scripts:

are purposeful – have a clear reason why you are calling someone;
use language the customer understands;
are designed for the benefit of the listener with it always being “the prospects choice” to accept or reject what they hear;
are brief and allow for questions and conversations;
aim to achieve a result – an appointment, donation, purchase, feedback, etc;
are planned not canned –they are flexible, allowing the sales person to adapt to the different needs or queries of the prospect whilst maintaining the integrity of the call’s purpose;
leave the prospect feeling valued and informed, even if they choose not to proceed with you in this instance; and,
are pleasant, respectful and engaging.

However, too many organisations push sales scripting too far creating word-for-word scripts that end up being stilted and clumsy at best and one-sided and ineffectual at worst. We had an experience recently with a telecommunications firm whose telephone sales and service people seemed unable to deviate from a scripted response as the responses they gave us had nothing to do with our issue. The impression this gave us was that our issue wasn’t even heard let alone acted upon – it didn’t fit their script. The number of times we had to request information to check that our matter would be dealt with made the whole experience cumbersome, time consuming and very frustrating. We ended up doing all the work, while the telephone sales and service person simply read from a script, which, as it turns out, could not account for our matter in its design.

Sales scripts are not meant to be regurgitated word for word with no deviation, nor are they meant to be a one-sided affair. This type of approach is called ‘canned’ scripting. You would think that in this day and age we would have ditched these ‘canned scripts’ but they still happen.

The Cluetrain Manifesto (a resulting force that rose out of the discontentment people experience with businesses and how they fail to communicate with people) really nails it when it says:

“Learning to speak in a human voice is not some trick, nor will corporations convince us they are human with lip service about ‘listening to customers’. They will only sound human when they empower real human beings to speak on their behalf. While many such people already work for companies today, most companies ignore their ability to deliver genuine knowledge, opting instead to crank out sterile happy talk that insults the intelligence of markets literally too smart to buy it.”

Building on this and taking the canned script one step further, some companies and political parties have even ditched the live person on the other end of the phone and opted for a recording instead. And this is supposed to engage us? This is free-to-air television advertising or junk mail in disguise. At least with television we can choose what we watch and we can put a ‘no junk mail’ sign on our letter box but getting ‘canned’ advertising over the phone takes the biscuit in my opinion. Yes there is the ‘do not call’ register which you can sign up to, however resorting to ‘recorded messages’ is lazy and only serves to create more angst in the already heated area of telemarketing.

If done properly, telephone sales is a very effective way of getting in contact with legitimate prospects. But when scripting removes the ability to genuinely listen and respond to a customer, we all suffer.

If you want to create positive and memorable experiences for your customers, members, donors or subscribers then seek to engage with them in a meaningful way. Don’t force your sales people to be rooted to the spot and limited by a one-size-fits all script. Trust your team to engage with people in meaningful ways by giving them the guidelines and tools they need to communicate effectively with the wide variety of people they encounter on a daily basis. The autonomy this gives your people puts back interest and challenge in the task of making effective prospecting calls and in the process might make the customers, members, donors or subscribers’ experience that much better.

Remember everybody lives by selling something.

Author: Sue Barrett, www.barrett.com.au

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