After having posted ‘Metrics to measure around a deal’ and ‘Sales people do not like to be tracked, measured or accounted for against anything other than quota’, the post ‘How Sales People Make Money’ by Jim Keenan (@heykeenan) from aSalesGuy.com is a great reminder for me what simple and straight forward a topic ‘motivation of sales people’ actually is:
“Sales people get paid by selling stuff. The more stuff they sell, the more money they make. The biggest impact on what a sales person makes, in some cases even more than their selling, is the comp plan. Sale people get paid on commission. Therefore, a sales persons compensation plan is the key to his or her earnings.
Management creates the comp plan. Comp plans need to be 3 things; simple, consistent and motivating.
Simple – Sales people have to be able to know what they’re getting paid for, how much and when. If they can’t understand how much they’ll make on a sale, your plan needs work. Sales people follow the money. If they can’t quickly understand, in their head, how much they make on a deal your plan is too complicated.
Consistent – It should be clear what you (management) is incenting. If you are looking to drive greater sales of a new product, the plan needs to support new product sales. If you want to increase services, then incent services. Far too often the comp plan does not support and align with managements message. This causes anxiety. Imagine being told to sell silly widgets, when you get paid more on dumb widgets. It’s stressful.
Motivating – Comp plans are in place to motivate sales. Good ones motivate sales people. They energize the teams and push sales people to excel. When plans aren’t simple or consistent they lose their value because they don’t motivate
Sales people get paid by selling. Sales people MAKE money because of the comp plan.
What does your comp plan look like. Is it simple? Is it consistent? Is it motivating? Creating the killer comp plan is the most impacting thing sales leadership can do to drive revenue. Don’t leave it to sales operations, don’t rush to get it out. Be creative, engage the team, connect with product, and align it with the corporate goals and make it the best damn comp plan you’ve ever created.
It’s how sales people make money and the companies revenues deserve it.”
“[...] Having worked in Sales and having a CRM background, I know why user adoption [of CRM systems] is not higher. Sales people do not like to be tracked, measured or accounted for against anything other than quota. Think about it. What other organization is measured against a quota, that if not met, will likely result in job loss? Sales is already measured.
The sales enablement concept is very interesting because it gives sales a real reason to use a CRM system. If it does provide value, user adoption goes up, ROI goes up, and hopefully, sales go up. Then everyone will be happy. The average tenure of a Sales VP is currently 19 months. Can your organization survive with 19 months or less of sales data?”
“[...] Sales are one of the most accountable areas of the organization and often are under the constant microscope of senior leaders as they have a significant, immediate, and direct impact on the bottom line.
[...] as a salesperson our job is to; Sell. Yes you ask me to do all kinds of little side projects, write reports, and conduct market investigations gathering data to insure what marketing is telling the CEO is actually what’s going on out here in this mystical place called “our market.” However at the end of the day my compensation is specifically tied to: selling stuff. The more stuff I sell the more money I make. My job is to “make it happen” with whatever you folks at corporate throw over the wall.
I tried telling you the reason that last product launch failed was because you created a product because you could and not because you should…but you said I was just making excuses and I needed to “sell through objections…and hit my numbers”
My pay, my commission rice bowl if you will, is about selling as much as I can, as quick as I can, and building relationships that plant seeds for future sales. With the internet my customers are more knowledgeable than they have ever been before about our products and services, (they often know things about our company before I do these days and this really makes me look bad in my market) so my job is really to help buyers solve their problems with the stuff I sell, and help them buy from us. I don’t like to discount our product unless I have to because my commission is based on the selling price, and the more I discount the more units I will need to sell to hit my targeted compensation. [...]
[...] About 70% of what marketing gives me I do not use. I know it will piss you off, but what I have been doing is writing my own stuff and using some of what Mike also created up in the North West region, you see it is old, but it works! [...]“
“[...] Every sales or marketing manager I talk to about Sales Force Automation (SFA) says that their company has to beat their sales reps over the head to get them to use it. Here’s how one of my clients describes their SFA experience:
“We spent almost half a million dollars to roll out our SFA system [...] we wanted more visibility into our pipeline so we could get better sales forecasts. We tried everything to get the reps to enter data. First we offered incentives, but that didn’t work. Then we started sending emails to the sales managers when their reps hadn’t logged in. That didn’t work either. Now we’re threatening to withhold commission checks if they don’t update their deals. So the reps wait until the night before their sales manager is meeting with the VP, and then they throw in some data. We don’t have much confidence in the data, but at least we’re getting the salespeople to log in.” [...]
You can’t blame the salespeople. They want to be out selling, but we’re asking them to be bookkeepers. As Joe Galvin from SiriusDecisions puts it, SFA really stands for Sales Force Accounting, since it provides management with visibility into sales but does little to help people sell. It’s no wonder it takes a stick to get them to use it.
What would your reps say if you asked:
Has the SFA system helped you be better prepared for the dialog you need to have on sales calls?
When was the last time you won a deal because of your SFA?
Do you get more value out of the SFA than you put in?
The last question is the kicker. The value meter is way out of whack. Reps are being asked to put a lot of data in, but they’re not getting an equal amount of value out. So they stick to using the tools they value…their Blackberries and iPhones.
While an SFA system has become an absolute necessity for the management of a sales team, it has been implemented as a tool of control rather than a tool of sales enablement. Traditional SFA systems are intended to collect data about sales activities for the benefit of managers, so they can get their pipeline and forecast reports, but are not built to give salespeople guidance on how to sell better.
If you want people to use your SFA and keep their opportunity records updated, give them a reason to go in. As you’re discovering the messages, tools, and conversations that are proving to work for your best reps, make sure these are delivered to your sales team through the SFA. Put your sales playbooks into the SFA. Turn your SFA into an SEA… Sales Enablement Automation. [...]“
All blog posts cited above were published on August 6, 2009. Please visit the sources to read the full texts and to leave comments for the authors. Whilst you should check out all the comments below, I would like to highlight the one from Bryan Karp (@midnitecoder).