When I’m asked by businesses why their sales staff are failing to meet their targets, my answer is a
Magnanimous: “Clarity,” I say. For all the excuses that salespeople use to explain their misses on targets – and I’m sure you’ve heard them all, from ‘ not competitive on price’ to ‘not enough leads’ or ‘bad territory’ and ‘poor economy’ – it is lack of clarity that lays at the heart of the majority of poor sales performance.
In this article, you’ll discover why clarity is so important as a foundation to ignite sales, and how to provide clarity when setting sales targets.
Nearly half your salespeople will miss their targets
The majority of businesses take a top-down approach when setting sales targets. They first consider how much product the company needs to sell, before dividing that overall revenue target between its sales staff. While this business planning strategy provides for performance-driven goals, management might be more targeted when setting those goals if they knew how many of their sales staff are likely to underperform.
Analysis by market research company CSO Insights should terrify your business strategists:
- In 2015, only 57.1% of salespeople made their quota
- Quota attainment by salespeople has declined steadily from 63% between 2011 and 2015
- Only 8 out of 10 businesses made their revenue targets in 2015 – down from 9 out of 10 in 2011
I suspect that if you analyze your sales division’s performance, you’ll come to the conclusion that if it wasn’t for your outperformers your revenue targets would have been missed, too. Transforming underperformers to high performers should be a priority target for your sales managers. The question to answer is: why do some salespeople overachieve while others consistently fail?
Without clarity, setting sales targets is meaningless
Sales targets should energize salespeople in their daily routine. They should help both the individual salesperson and the sales team to create a well-defined strategy and then plan how they are going to achieve their targets.
At the one extreme of target-setting, I’ve been told by a salesperson that they have goals set for the year that amount to no more than “You had a great year last year, we need to improve on that this year.” That’s like asking a football player to kick a field goal through thick fog.
Targets like these are difficult to hit. The lack of clarity in the target creates stress, emotional turmoil, and conflict.
Making sure the sales targets are clearly defined
I’ve also found it a common occurrence that the sales manager responsible for setting an individual’s target has a different perception of the targets given, to those perceived by the salesperson. When I challenged the manager of the salesperson mentioned above, he told me that he had made it clear that the company was looking for a 15% improvement on targets. The manager assumed that the salesperson would translate this to their personal goal of a 15% uptick in sales numbers.
This brings me back to the need for clarity, and the need to understand that different people have different communication styles. By making assumptions, the manager had created communication havoc and risked a deteriorating relationship with one of his star salespeople.
Instead of discussing the company’s goals, patting the salesperson on the back for a job well done the previous year, and then assuming that the salesperson would translate the conversation into the new goal, the manager would have eliminated confusion and underperformance by:
- Paying more attention to the salesperson, including their body language
- Clarifying what has been said in a two-way flow of information
- Ensuring buy-in to the new targets
- Confirming goals in writing
Clarity produces energy
When goals are clearly defined and understood, you’ll find that your salespeople are more energized to succeed. They are better able to create a workable strategy, and put plans in place that will see that strategy succeed.
Lack of clarity is the single biggest reason for targets being missed. The New Year’s resolution to lose weight is the most commonly missed target in the world. The New Year’s resolution to lose x number of pounds by a definite date is among the most commonly achieved targets in the world. Why? Because the target is achievable and clear, and this enables a strategy and plan to be made and worked to.
When setting sales targets with your staff, make sure that your conversation answers these important questions:
- Why is the target important to the salesperson?
- Is the target clear, and can it be easily measured?
- Is the support structure available to help the salesperson achieve their target?
- Are the rewards of achieving targets clearly set out?
Set sales goals with clarity, and your sales staff will strive to attain their targets while others are ditching theirs.
Our Integrity Selling Course will help your sales team onboard new skills, embed methods of identifying customer needs, and hone them to perfection. The result will be a high-impact sales team on an exponential sales curve. Contact us today to discuss how to propel your sales team to qualified success.