Properly Evaluating Salespeople: A Matter of Timing
20 December 2010
Read by 2001 persons
To verify that each team member plays their part well, the manager has reliable indicators. The key is to know how to use them at the right time.
There is no shortage of tools for evaluating the performance of salespeople. From a simple Excel spreadsheet, practical for comparing sales volumes, to a sophisticated questionnaire designed to assess a salesperson's leadership or ability to work as part of a team, managers have a wide range of indicators to get a precise idea of each person's contribution.
But beyond the choice of instruments, there is the question of the frequency of measurements. To be effective, these must be carried out at a precise rhythm, with regular appointments. The steps suggested here allow, in most cases, for optimal monitoring.
Weekly: Monitor prospecting actions
The success of a sale lies in its preparation. Prospection actions should therefore be monitored weekly. The key indicators in this area? The number of clients contacted and appointments made, the rate of commercial proposals (appointments that led to a proposal) and the conversion rate (proposals that led to a signature).
These parameters are crucial because the results obtained at the end of the year depend on them. At Altares (sale of economic and financial data on companies), reporting is mandatory every Friday. The sales manager thus has the weekend to take a step back and analyze the collected elements.
Caution: information measuring prospecting efforts (number of phone calls made or clients met) is not intended to be disseminated within the team. This is to avoid those who are simply average feeling reassured and ultimately the whole team becoming complacent in this mediocrity.
On the other hand, the rates of commercial proposals and conversion can be made public. More rewarding, these indicators, which show that efforts pay off, are a source of positive energy. When a salesperson shows excellent ratios, most often, others want to equal them and will, to do so, surpass themselves.
Monthly: Measure individual sales performance
Sales performance, properly speaking, is measured on a monthly basis. We are talking here about the salesperson's direct contribution to turnover, the margin generated on each of their sales, their responsibility in the company's overall market share, but also their progress over the past twelve months.
Since this data makes it possible to determine the variable part of the salary, transparency must be total. You must send this data to each salesperson, on a fixed date, the second or third day of the following month, for example. Sufficient in B to C, this periodicity is even more so in B to B, where the rate of order renewal is slow. When selling office equipment or training, the purchasing process often takes three to six months. Therefore, there is no need to put pressure on: your salespeople will not be able to shorten their clients' decision-making processes.
It is also advisable to cross-reference monthly indicators with weekly barometers to draw all the lessons. Does the turnover seem weak? Correlate it with the number of appointments made. It may be that the salesperson is not spending enough time with their clients. And if they achieve their objective, check that a single large contract is not at the origin of this performance. This may mean that they are not concluding enough sales or that they are not prospecting widely enough.
Quarterly: Aggregate data by area or activity
If the previous indicators are individual, those that can be examined every three months concern the collective first. This is the case, in particular, for the results of an area or a division as a whole: the turnover achieved by the North region, the market shares obtained by the large accounts department, the progress of the team in charge of the SME market... This data makes it possible to compare teams according to geographical areas, product lines or markets.
A quarter is also the right periodicity for a competition. This type of appointment is ideal for motivating a team. At Altares, a challenge is organized for telesales representatives: every three months, those who have achieved the highest turnover receive a bonus. Of course, the criteria must then be defined unambiguously and communicated to everyone. For greater efficiency, the proclamation of results, their analysis and the announcement of corrective decisions can be carried out during large gatherings bringing together all the teams concerned.
Annually: Evaluate salespeople's behavior in one-on-one meetings
The annual interview is an opportunity to take stock in a one-on-one meeting with the salesperson on their general attitude at work. You will assess their ability to work as part of a team, to deploy their leadership or to mobilize their colleagues. You will examine how they fill in their customer relationship management tool (a poorly updated form can have serious consequences) and you will consider the quality of their account review (document in which they present the strategy implemented with their important clients): is their analysis relevant, are their figures realistic?
This is also the time to see with them how to improve their clients' satisfaction rate. If necessary, opt for a refocusing. If, for example, the person concerned is unable to mobilize their pre-sales engineers because they lack leadership, you must act before they cut themselves off from the team.
Annual indicators therefore measure both the salespeople's analytical capacity and their internal and external behavior. As such, they can serve as evaluation criteria: at Accor, 20% of the variable part of salespeople's remuneration depends on them. J
Published on December 13, 2010
Posted online on December 21, 2010
www.capital.fr
There is no shortage of tools for evaluating the performance of salespeople. From a simple Excel spreadsheet, practical for comparing sales volumes, to a sophisticated questionnaire designed to assess a salesperson's leadership or ability to work as part of a team, managers have a wide range of indicators to get a precise idea of each person's contribution.
But beyond the choice of instruments, there is the question of the frequency of measurements. To be effective, these must be carried out at a precise rhythm, with regular appointments. The steps suggested here allow, in most cases, for optimal monitoring.
Weekly: Monitor prospecting actions
The success of a sale lies in its preparation. Prospection actions should therefore be monitored weekly. The key indicators in this area? The number of clients contacted and appointments made, the rate of commercial proposals (appointments that led to a proposal) and the conversion rate (proposals that led to a signature).
These parameters are crucial because the results obtained at the end of the year depend on them. At Altares (sale of economic and financial data on companies), reporting is mandatory every Friday. The sales manager thus has the weekend to take a step back and analyze the collected elements.
Caution: information measuring prospecting efforts (number of phone calls made or clients met) is not intended to be disseminated within the team. This is to avoid those who are simply average feeling reassured and ultimately the whole team becoming complacent in this mediocrity.
On the other hand, the rates of commercial proposals and conversion can be made public. More rewarding, these indicators, which show that efforts pay off, are a source of positive energy. When a salesperson shows excellent ratios, most often, others want to equal them and will, to do so, surpass themselves.
Monthly: Measure individual sales performance
Sales performance, properly speaking, is measured on a monthly basis. We are talking here about the salesperson's direct contribution to turnover, the margin generated on each of their sales, their responsibility in the company's overall market share, but also their progress over the past twelve months.
Since this data makes it possible to determine the variable part of the salary, transparency must be total. You must send this data to each salesperson, on a fixed date, the second or third day of the following month, for example. Sufficient in B to C, this periodicity is even more so in B to B, where the rate of order renewal is slow. When selling office equipment or training, the purchasing process often takes three to six months. Therefore, there is no need to put pressure on: your salespeople will not be able to shorten their clients' decision-making processes.
It is also advisable to cross-reference monthly indicators with weekly barometers to draw all the lessons. Does the turnover seem weak? Correlate it with the number of appointments made. It may be that the salesperson is not spending enough time with their clients. And if they achieve their objective, check that a single large contract is not at the origin of this performance. This may mean that they are not concluding enough sales or that they are not prospecting widely enough.
Quarterly: Aggregate data by area or activity
If the previous indicators are individual, those that can be examined every three months concern the collective first. This is the case, in particular, for the results of an area or a division as a whole: the turnover achieved by the North region, the market shares obtained by the large accounts department, the progress of the team in charge of the SME market... This data makes it possible to compare teams according to geographical areas, product lines or markets.
A quarter is also the right periodicity for a competition. This type of appointment is ideal for motivating a team. At Altares, a challenge is organized for telesales representatives: every three months, those who have achieved the highest turnover receive a bonus. Of course, the criteria must then be defined unambiguously and communicated to everyone. For greater efficiency, the proclamation of results, their analysis and the announcement of corrective decisions can be carried out during large gatherings bringing together all the teams concerned.
Annually: Evaluate salespeople's behavior in one-on-one meetings
The annual interview is an opportunity to take stock in a one-on-one meeting with the salesperson on their general attitude at work. You will assess their ability to work as part of a team, to deploy their leadership or to mobilize their colleagues. You will examine how they fill in their customer relationship management tool (a poorly updated form can have serious consequences) and you will consider the quality of their account review (document in which they present the strategy implemented with their important clients): is their analysis relevant, are their figures realistic?
This is also the time to see with them how to improve their clients' satisfaction rate. If necessary, opt for a refocusing. If, for example, the person concerned is unable to mobilize their pre-sales engineers because they lack leadership, you must act before they cut themselves off from the team.
Annual indicators therefore measure both the salespeople's analytical capacity and their internal and external behavior. As such, they can serve as evaluation criteria: at Accor, 20% of the variable part of salespeople's remuneration depends on them. J
Published on December 13, 2010
Posted online on December 21, 2010
www.capital.fr
