Sales is a profit center. It doesn’t matter how smoothly operations are running or even how forward thinking your organization’s management techniques are -- at the end of the day all that matters is whether your sales team is able to bring in revenue or not.
Generating revenue has never been an easy job, but it’s critical for the success of the company. When the overall sales targets are not met, there could be negative repercussions for the business’ valuation, share price, investors, and other organizational aspects. Therefore, sales targets are sacrosanct.
What leads to a missed month or quarter? A failure to understand the sales team. For example, just how well do you know
The factors driving sales performance?
Why certain sales teams meet or exceed targets while others don’t?
In this blog post, I put forward four simple mantras that can help sales leaders truly understand their team. If you can put these into practice, prepare for the best quarter ever.
1) Rely on historic performance.
Prior performance is a dependable indicator of future performance. From my experience, I’ve observed that almost 50% of current underachievers tend to perform poorly in coming quarters as well.
When you see poor performance, don’t ignore it. Intervene when a team has consistently performed poorly over a number of previous sales cycles.
2) Get to 25% of target in the first month.
Anything less than 25% of target attainment in the first month significantly increases the chance of missing the quarter. Therefore, during the first month of the quarter, management should intervene with teams that have achieved less than 25%.
3) Go for the small opportunities (they add up).
I’ve noticed that excellent performers always target a high number of small and short-term opportunities in order to achieve their quota. In another words, they are not waiting for the big fish to fall in their nets -- instead, they’re attacking several smaller ones.
4) Never increase plan by more than 10% for underachievers.
When the plan is increased by any more 10%, the likelihood of poor performance increases as well. There is a natural fear that hits salespeople when they see a plan increase by 10% or more. Instead of picking an arbitrary percentage, base bigger quotas on the previous quarter’s performance.