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How to Retain and Motivate Sales Reps: Money versus Happiness

All sales leaders want to motivate reps to high levels of performance and retain their top earners. What’s the secret to success in these areas?

To find out, you might start by asking sales reps what they want in exchange for their hard work. And one of the first things they’re likely to say is higher commissions and bigger bonuses.

In some ways, this makes sense. Everyone wants a stable income and to be able to provide for themselves and their families. And because salespeople are competitive, they typically appreciate benchmarks to measure how they’re doing, and money is an easy indicator to look at. If they’re making $10k more this year than last year, they feel like a success. If they can finally afford to buy big-ticket items (cars, clothes, gadgets) they feel like everyone else knows they’re a success, too.

It is one thing to be motivated by money, but it’s another to use money as a means to happiness, fulfillment, and meaning. While sales reps don’t always talk about these things, these factors have a big influence on their decision to stay with your company or start looking around for the next opportunity.

Science suggests that, past a certain point, money does not make us any happier. This video from AsapSCIENCE points out that people generally adapt quickly to higher levels of income. Research has shown that, in North America, income beyond $75,000 has no impact on our levels of daily happiness.

If you believe that part of keeping reps motivated means keeping them happy, then maybe it’s time to stop relying so heavily on cash as an incentive.

Reps will always appreciate your help in getting to the next level financially. But if you help them learn to define success and happiness outside of money, that creates a valuable dynamic of trust and support. Those qualities can actually become your competitive advantage — companies that have deeper pockets to pay blowout commissions will be less of a threat to poaching your reps.

In fact, there is evidence to uphold the idea that money is not the greatest long-term strategy for keeping reps around. The fact that money can be fleeting might be something that older and wiser reps learn to understand on their own — Peak Sales Recruiting points out that, over the course of a sales rep’s career, research has shown that higher earners report lower levels of interest in more money.

Money comes and goes, but the value of strong relationships never fails. As a sales leader, what steps are you currently taking to motivate and retain your reps, beyond using money?

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How to Land a Meeting with Your Prospect

Many sales professionals believe that sales are made based on the strength of relationships with prospects and customers. In other words, it’s all about who you know.

In the current selling environment, however, some might argue that success in sales is actually more about what you know. According to research conducted by Forum, for example, two of the top three reasons prospects decide to buy from a sales rep include these factors.

  1. The rep knows my company.
  2. The rep knows my industry.

Notice that the word “relationship” does not enter into the picture. What does this imply? As Forum General Manager (Americas) Alyson Brandt points out in the video interview below with Selling Power founder Gerhard Gschwandtner, this research indicates that prospects are looking more for value and insight from salespeople rather than a simple connection.

“There are some misnomers about what customers expect,” Brandt says. “It’s a mythbuster to believe that you have to know somebody in order to be effective in a sales role and get a meeting.”

At Forum, we’re working with experienced salespeople to help them become more effective in prospect meetings by leveraging Point of View Selling. Point of View Selling creates new selling opportunities with existing and new customers– whether you have an existing relationship with them or not.

Although Point of View Selling is suitable for all organizations, not all companies are ready for it.Consider the five big questions below to see if your organization is ready to take its sales to the next level.

  1. Business Fit: Do you offer a mix of products, services and/or complex solutions that can significantly impact your customers’ business value drivers? Point of View Selling hinges on the ability to make that impact clear to the customer.
  2. Compelling Points of View: Do your salespeople have the ability to deliver unique values that can be potential differentiators in commoditized markets? For example, when a biotech company introduced a revolutionary technology that drastically reduced the time it took to identify an infectious disease, their sales initially underwhelmed. They quickly realized that, rather than focus on the technology itself, they should focus their selling efforts on the unique value the technology created: time. By doing this, they were able to call on senior people and appeal to their need to manage risk and deliver value to their constituents and themselves. For example, they called on heads of state and other dignitaries (e.g., the head of the Summer Games) and asked them whether they could afford to have a pathogen running rampant in an urban area while testing took days.
  3. Foundational Skills: Do your salespeople have the business acumen, industry knowledge and consultative selling skills needed to succeed?
  4. Advanced Selling Skills: Can your salespeople then combine that business acumen and industry knowledge to develop high-value and unique points of view, provoke and engage senior-level decision makers, and guide customers in framing complex decisions?
  5. Sales Support and Infrastructure: Do you have the resources — time, budget and staff — to help craft points of view and support jumping to the next level?

Every sales organization that is implementing or considering implementing a Point-of-View-Selling strategy falls somewhere along the maturity curve suggested by these five questions. Organizations that take realistic views of where they are today and invest in building capabilities across all five of these areas are the most likely to gain competitive selling advantage when adopting higher-level selling approaches.

When was the last time you landed a meeting with a high-level prospect? How were you able to convey insight that grabbed the prospect’s attention? Share your thoughts in the comments section. 

Jeffrey Baker
Jeffrey Baker is vice president, salesforce effectiveness at The Forum Corp., a Boston-based premiere learning organization.
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Attitude Determines Altitude: Selling Power Says Goodbye to Zig Ziglar


This week great motivator, author, and sales leader Zig Ziglar passed away at the age of 86. We searched our archives and republished some of our best articles featuring Ziglar’s insight and wisdom. Click the links below to read more about Ziglar’s life and lessons, and why he leaves an incredible legacy.

An Interview with the Great Zig Ziglar (1997)
Learn the personal tips that put Ziglar at the top of his field and created success for a lifetime.

Remembering Zig Ziglar: Keys to Sales Success
Gerhard Gschwandtner, founder and CEO of Selling Power, interviewed Ziglar for Selling Power magazine a number of times. In this post, Gschwandtner remembers a few memorable stories Ziglar shared with him. 

Remembering Zig Ziglar: America’s #1 Motivator
A transcript of Gschwandtner’s first interview with Zig Ziglar, originally published in 1982.

 

 


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Insight for More Excellent Sales Management in 2013

This week Inc.com announced that bad managers cost the economy $360 billion in lost productivity annually. Hopefully, your sales managers aren’t making any personal contributions to this statistic. Either way, we thought it couldn’t hurt to assemble some collective insight for better sales management as we move into 2013.

ONE: Understand the skill set of a good sales manager, and fill the role accordingly.

Many sales managers were promoted from the position of sales rep. This isn’t a great idea. In fact, Peak Sales Recruiting says there are at least six basic reasons to NOT promote a top-performing rep to a position as manager. Jonathan Farrington, a globally recognized sales thought leader, agrees — as he points out, the successful attributes of a sales manager usually don’t align with the successful attributes of a top performing rep. Make sure you’re hiring sales managers based on management skills, and not solely on a track record of sales success.

TWO: Make sure your sales managers are practicing good coaching habits. 

A pre-call briefing, a ride-along to observe the sales call, and a post-call coaching session are all best practices for coaching recommended by Norman Behar at Sales Readiness Group. Are your sales managers actively involved in these activities? Or are they too busy running from one fire to the next as the end of each month and each quarter looms large? If your managers don’t know how to coach (or are simply not making time for it), you’re almost certainly cultivating discontent among your reps. So perhaps it’s no surprise that research from Oracle (quoted by Chuck Penfield at the most recent Sales & Marketing 2.0 Conference in San Francisco) has indicated that 89% of sales reps want more coaching from their managers.

In a Sales 2.0 world, managers who aren’t invested in coaching are going to lose out on the rewards you can reap by combining science with soft coaching skills. According to PI Worldwide President and CEO Nancy Martini, who also spoke at the Sales & Marketing 2.0 Conference, the ability to combine analytics with coaching holds unprecedented opportunities for sales managers to build more effective and productive sales teams that generate higher revenue. Clearly, coaching is a vital aspect of sales management and should not be ignored.

THREE: Make sure sales managers aren’t letting underperforming reps linger.

Christopher Cabrera, CEO of Xactly Corporation, recently blogged about his company’s joint research project with MIT which is examining data related to about 200 million transactions handled by Xactly each month. One early takeaway from initial analysis is that sales managers are probably hanging on to bad sales reps for longer than necessary. To quote from Cabrera’s post:

Our hypothesis is that many managers, if on the borderline of attaining their quotas, tend to keep low-performing salespeople on the books for too long. Those managers would rather keep underperformers on the books to generate even a few sales rather than the guaranteed zero sales they’d get if they fired the bottom tier.

This can obviously be a difficult call for a sales manager to make — and an even more difficult conversation to have once the reality sets in. But after you’ve done all you can to give lagging reps a leg up, it’s better to face the problem head on than to sweep the problem under the rug.

FOUR: Embrace the virtual meeting.

Based on her in-depth survey of 150 managers, Yael Zofi, founder and CEO of AIM Strategies told Selling Power magazine that “virtual teams are here to stay.” In fact, at least 70 percent of those she surveyed reported seeing a rise in virtual teams. Obviously, the virtual element of management has some very basic implications for process and operations. For example, take your weekly sales meetings. Are your sales managers holding frequent and regular meetings with field sales reps, no matter where they’re located? Your sales managers should be using video conferencing tools (like PGi’s iMeet, for example) to facilitate more effective and collaborate meetings, no matter where meeting participants are located.

Incidentally, if sales managers are already making use of video conferencing for meetings with reps, then it stands to reason that reps can use the same technology to meet with customers and prospects as well. That sets up your sales manager to increase team productivity and possibly win rates.

In the end, a bad sales manager adds up to a dysfunctional sales team populated by unhappy reps. And unhappy reps will only stick around for so long — the same Inc.com infographic shows that 65% of employees said they’d take a new boss over a pay raise.

Consider, too, that the workforce is fast becoming populated by Gen Y workers, who tend to prefer feedback from coaching and collaborative work environments. An investment in upping your standards for sales managers will put you on the path to success now and for years to come.

What are your best practices for sales management? Share your thoughts in the comments section. 

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A Ten-Point Sales Leadership List for 2013

by Gerhard Gschwandtner

As we near the end of 2012, I’m certain about one thing: your success in sales will be dictated by how well you anticipate your buyer’s needs and expectations. Here’s a list of questions that can help you prepare your sales organization to win in 2013.

1. Do you thrive on change?

If your company’s rate of innovation is slower than normal for your industry, you can’t expect forward momentum. Customers are always looking for new ideas. If they can’t get them from you, they’ll get them from your competition.

2. Are you committed to ongoing improvement?

The more you improve as a company, the better you can help your customer’s business improve. Remember that the more customers improve as a result of your sales efforts, the better your bottom line.

3. Are you stretching your abilities?

If your salespeople don’t stretch their abilities, you’ll see a stretch in your company’s liabilities. If your team’s sales goals are not stretched, your cost of sales soon will be.

4. Are you removing all barriers to buying?

If you can’t deliver what your customers want, when they want it, they will surely look elsewhere for a company that can. Are you willing to improve your sales performance to a world-class level? Do you have a plan for mapping your sales cycle to the buyer cycle, and removing all barriers to buying?

5. Do you exploit technology aggressively?

The purpose of technology is to save time for the customer, to manage relationships for the sales team and to help management improve the organization. Is your information technology truly designed to serve people’s needs?

6. Is everyone motivated to win?

People come to work to win, not to lose. Winning demands that the heart be involved in the job. If salespeople love what they do, sales managers will love the results.

7. Do you measure and reward top performance?

Winners expect results, not excuses. Result seekers are scorekeepers. Set competitive rewards commensurate with the levels of achievement.

8. Are you managing meaning?

Rethink, resell and renew your company’s mission. If your salespeople can’t answer the question “why are we doing this?” you cannot expect them to get the job done. Once your sales team knows the “why,” the “how” will be easy.

9. Are you failing forward? I

f nobody makes a mistake in your organization, it’s a sure sign that you’re not growing. Use failure as an opportunity to learn. If you want to triple your success ratio, you have to triple your failure rate.

10. Are you creating trust?

How much trust do your customers place in your company? The answer will be in direct proportion to the amount of repeat business. How much trust do your salespeople place in your company? The answer will be in inverse proportion to your turnover. Do the right thing and you will create more trust.

Gerhard Gschwandtner is founder and CEO of Selling Power, and is host of the Sales 2.0 Conference. Follow him on Twitter @gerhard20.
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Why Love (Not Money) Makes Great Leaders: Insight from Dr. Herb Greenberg

According to Dr. Herb Greenberg, founder of Caliper Corporation, great leaders are not motivated by money.

This is just one of the conclusions Dr. Greenberg drew from his extensive research on the qualities and characteristics that make great leaders, which he published in his book, Succeed on Your Own Terms (which eventually became a New York Times bestseller).

Among the hundreds of leaders interviewed for the book, Dr. Greenberg says that each had his or her own unique definition of success. “Each person knew exactly what he or she needed to do in order to feel like a success, short term and long term,” says Dr. Greenberg. “None of these leaders used money as a definition of success.”

Dr. Greenberg (who lost his sight at age 10) launched his own long and successful career with a single great idea — he was convinced there was a market for assessment tools that could help companies assess qualified candidates for job openings, including sales. In 1961, he left his job as a college professor and founded Caliper. He and his business partner began knocking on doors to spread the word about the value of a comprehensive personality test to assess job candidates in management, sales, and customer service. At the end of four months, they had nothing to show for their efforts but a string of rejections. “Many times, I woke up thinking to myself what have I done?” Greenberg told Inc.com in this video interview. In a blog post, he summed up his recollection of that time by saying, “The number of rejections, including being laughed at, cannot be counted — I can only say that we needed face masks to protect us from the doors slammed in our faces.”

Finally, Gail Smith, VP of Merchandising for General Motors, decided to take a chance on them. Just three years later, Caliper was performing assessments for 900 job candidates a month for dozens of clients. Dr. Greenberg told Inc.com that persistence was key to their success. “Fight through the failures, take the rejections … and we say this to anybody who’s looking for a job or a client. People are going to tell you ‘No.’ If you’re ahead of the curve, you’re going to hear ‘No, no, no.’ You need the ego strength to take that beating … and push forward.”

Today, Caliper employs more than 250 professionals in 12 offices around the world and is a recognized leader in using personality tests and assessments to predict success in management, sales, customer service, and even sports. In this video interview, Dr. Greenberg shares a story with Selling Power founder and CEO Gerhard Gschwandtner about a successful basketball player they interviewed.

“Everyone said he had all this talent in the world … but would never be Shaquille O’Neal or a Tim Duncan, or any of the great ones,” Greenberg says. “I said, “What’s holding you back? Why aren’t you as good as you could be?’ He said, ‘I hate this game.’ I said, ‘So why are you playing it?’ He said, ‘They pay me $6 million a year!’ But that’s what stopped him from being a great leader. Not loving his work.”

Watch the interview below between Dr. Herb Greenberg and Gerhard Gschwandtner and discover the top qualities that all great leaders share.

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Stop Hiring the Wrong Sales Reps

According to Peak Sales Recruiting, the cost of adding the wrong salesperson to your team can total nearly seven times the annual salary for the position. Yikes!

How can sales leaders mitigate the danger of making an unwise hiring investment? One of the best ways to find out what’s really behind a stellar resume and great interview skills is to talk with people the rep has actually worked for or with.

That’s why some companies are now using confidential electronic surveys to gather feedback on candidates from multiple sources (such as managers, peers, and direct reports).

Many sales leaders might have felt burned in the past by glowing recommendations that turned out to be pie-in-the-sky endorsements, but the confidential nature of such surveys inspires candid feedback, say the folks at SkillSurvey. They have long believed that traditional phone reference checks are outmoded and insufficient to give sales managers a truly objective look at a candidate’s past performance.

Their automated survey is designed to provide a “360-degree” assessment of a candidate’s behaviors, skills and developmental needs — and the confidential request for feedback works: more than 85 percent of references respond to a reference request when the request guarantees anonymity.

When soliciting feedback from references, SkillSurvey asks about a candidate’s:

  • Ability to consistently meet or exceed sales goals.
  • Persistence when faced with objections or other setbacks.
  • Competencies in managing post-sale relationships.
  • Determination in locating qualified sales opportunities.
  • Ability to leverage technology (like CRM) for productivity.

To learn more about how how to efficiently and accurately assess potential sales hires for your team, join us on Wednesday, October 25 (2-3 PM Eastern) for a live Webinar, “How to Avoid the High Cost of a Bad Sales Hire.” Selling Power founder Gerhard Gschwandtner will be hosting, and panelist Jack Kramer, Vice President of Field Operations at SkillSurvey, will be sharing insight and expert tips.

 

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How Sales Leaders Can Avoid the Quarter-End Crunch

Quarter end crunch in sales
Image courtesy of FreeDigitalPhotos.net/DigitalArt.

The end-of-quarter crunch.

For most sales teams, I’d venture to say it’s 10% adrenaline-fueled excitement, and 90% utter torture.

A quarter-end wish list for any head of sales would likely include these items:

  • a healthy deal cushion to serve as a fail-safe;
  • complete visibility into sales team activities on prospective accounts; and
  • predictability.

The end-of-quarter timeline will vary depending on your goods or services, but the anxiety level maps to the same pattern:

Code Yellow: Pricing
You and your prospect should have agreed on pricing terms X number of weeks before the end of the quarter. You know what X is for your organization (for us in the software world, we’d be looking at approximately four weeks from quarter close).

Code Orange: Contract Review
You have a contract ready for the counterparty’s review by this number of weeks from the quarter end (for my team, it’s three weeks). If terms are still being haggled, it is unlikely you’ll close the deal in time.

Code Red (an appropriate color): Redlines
You should have a redlined copy of the contract from your prospect by this point (for us, two weeks from quarter-close).

Point of No Return
You’re in the office at 6:00 a.m. every day that last week, trying for last-minute heroics, but the reality is you were counting on a deal that didn’t adhere to your timeline.

In an ideal sales world, we could structure predictable outcomes from vendor-selection stage to the moment the customer signs on the dotted line. The limited amount of time we have to close deals at quarter-end forces us to take a good, hard stare at how we can improve efficiency closer to the beginning of the negotiation process.

One simple way to avoid the quarter-end crunch is to inject deal predictability and efficiency into the sales cycle. How? Start with the foundation of your deal: the contract. Here are some techniques that you can start implementing right away:

1) Get a term sheet from your prospect as early as possible. Knowing up front what your prospect intends to include in the contract will ensure that you have a clearer picture of the deal timeline. The sooner you can see the terms and conditions that are crucial to your prospect, the faster you can respond (and the better prepared you’ll be for negotiations). At this point, you’ll already have improved your deal predictability by understanding if the feasibility of your prospect’s essential terms implies weeks, months – or even more than a year for deal closure.

2) Create a “contract playbook.” Perhaps one of the most important things you can do in the early phases of a deal is create a contract playbook – the series of items to which you’re willing to agree so the deal doesn’t get bogged down in legal quicksand. One of the common reasons a negotiation gets delayed is unreasonable terms and conditions on both sides of the fence. Creating your contract playbook ensures that you have a plan about which cards you want to show.

3) Prepare the way for quick signoff.  If you’ve cleared the more difficult hurdle of coming to terms, you don’t want to miss closing the deal because you can’t get the contract to the right people at the right time. Make sure you fully understand the sign-off process for your deal before crunch-time hits. If you have many different types of contracts and a complex approval cycle, consider deploying contract-management software that can automate many of the steps, reduce errors, and speed the approval cycle.

End-of-quarter stress is a fact of life for sales teams. Rather than hope for last-minute heroics to get your deal done, invest in some smart steps ahead of time so make the process more predictable. You’ll be ahead of the game and ready to speed to close when the customer says, “Yes.”

Doug Bell
Doug Bell is Chief Commercial Officer at Selectica.
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5 Important Blog Posts for Sales Leaders

Busy week with your sales team? We thought so. Here are links to five great blog posts you might have missed in the past week, related to topics especially important to sales leaders (including compensation, motivation, social selling, Sales 2.0, and the new B2B buyer cycle). Happy reading!

Blog Post #1: The smart way to motivate, reward, and compensate sales reps (via Sales 2.0 Conference blog)

Have transparent payout information. Salespeople shouldn’t worry if last week’s deal will be in their paycheck or not. If they can see the deal is credited toward their payouts, they can focus on the next one. According to Zuora, it’s a “dispute killer.”

Blog Post #2: Know your B2B buyer cycle (via Sales 2.0 Conference blog)

Here are three basic questions that sales leaders should be able to easily answer about today’s buy cycle:

  1. How well can your sales team build relationships with customers via a variety of channels?
  2. How well does your sales process map to the buy cycle?
  3. How empowered are your reps to have compelling and relevant conversations with qualified prospects online?

Blog Post #3: Saying goodbye to the good old days of selling (via Selling Power blog)

I have always believed that selling is an art. Today, however, no sales leader can afford to ignore science. Sales 2.0 and technology solutions are making the art of selling measurable in actual numbers. And that is going to have a huge effect on the way we lead sales teams in the years to come.

Blog Post #4: Communicating value to prospects (via Heinz Marketing blog)

Many companies include examples of the problem in their sales presentations, and wonder why prospects don’t immediately light up.

Your prospect isn’t going to buy unless the cost of changing is lower than the cost of doing the same. Isolated, anecdotal evidence doesn’t change that value equation. But communicating the scope of the problem very well may.

Blog Post #5: The effect of social on enterprise selling/thoughts on Marc Benioff’s keynote at Dreamforce (via Sales 2.0 Advocate blog)

As your customers, employees and partners become increasingly connected online, this raises some interesting questions, opportunities and risks in regards to trust:

  • Will we have some kind of open and universal access to ratings and reviews for B2B sales and service professionals as we now see on consumer Internet sites for professionals like doctors? Will enterprise products – and the companies that produce them – be subject to a proliferation of eBay or Yelp-like reviews?
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Become a Better Leader: Tips from a Former Fighter Pilot

If you want to be a compelling leader, you need to inspire your team, challenge them, and tie their everyday activities to the larger vision for the company. In this video, former fighter pilot Waldo Waldman talks about a commanding officer whose “consistent passion and focus” inspired him to be a better fighter pilot — and why he thinks the secret of great leadership lies in one-on-one interaction.