At some point in time, many salespeople and even entire sales teams experience a selling slump. Sales managers must correct this problem and improve sales performance.
Many sales managers and business owners attempt to solve the problem by encouraging the salesperson to keep a positive attitude and to try harder. Others give pep talks to the entire sales team. Yet others threaten to fire people if they don’t increase their sales. Do any of these approaches work? Of course not.
Peel the Onion – Whether they are dealing with an individual sales person or an entire team, the best sales managers peel the onion to find the root cause of low sales performance and resolve the problem. Why? And why? And why?
Root Causes – An individual’s sales performance problem can be triggered by a variety of situations. Most often, the root causes are in two key areas: poor sales call quality or low sales call quantity. A deficit in the quality or quantity of sales calls will result in lowered performance.
Quality and Quantity Depends On Sales Communication Performance and Interpersonal Skills – How well the salesperson develops rapport, uncovers customers’ needs, relates the benefits of products or services to meet needs, and closes the sale. Sales call quantity, or sales activity level, depends on the individual’s ability to deliver a compelling presentation that is “conversational” and designed to move the prospect through the steps of the sales cycle. The best sales managers observe each salesperson’s skill and effectiveness at each step of the sales cycle to determine the quantity and quality of sales calls.
By identifying key activities, such as prospect qualification, system design, proposal, and closing calls, prospects can be tracked through the sales cycle to a close. Monitor the effectiveness of a salesperson in moving the prospect to the next step of the sales cycle.
For example, by determining the number of prospects needed to generate a proposal and the number of proposals needed to get one closed order, a success ratio for each step of the sales cycle can be calculated. These ratios allow the salesperson or manager to define the activity level needed to create and sustain the desired performance level.
Be aware of changes in an individual’s or the entire group’s success rates. For example, if it typically takes three proposals to get a closed order and the number has recently increased to five, the situation should be examined more closely to determine whether a problem exists. Again, to resolve the problem, look for the root cause, not just the symptom.
By comparing activity levels and success ratios to previous results and possibly other successful salespeople in similar assignments, performance problems can be identified. By ensuring that the quality and quantity of sales calls are sufficient, a salesperson’s performance problem can be corrected. Even adequate or good performance can be increased by improving the quality and quantity of the salesperson’s interaction with the customer.
Tips to Identify and Correct Performance Problems
- Define order size and frequency. Compare to previous results.
- Determine current average gross margin or profit and compare to previous results.
- Determine if service or support is being undervalued, included, or even given away.
- Compare a salesperson’s present results to results of others or to company standards.
- Implement a consistent skill development program.
- Be sure the salesperson is asking the prospect to say ‘yes,’ not just making a friendly visit.
- Ensure that each sales call has a specific objective to progress the sales cycle.
- Set targets for number of prospects identified.
- Set specific and ample activity targets for each step of the sales cycle.
- Track progress in reaching the activity targets not just result targets.
- Monitor the closing or success ratio of each step of the sales cycle.
- Monitor order size and profitability to ensure time and energy is spent on high payoff accounts.
These are just some of the many ways to improve sales performance.