Sales Goals Should Inspire Growth.  So why don't they?

You know the feeling. The book is closed on 2018 (or any fiscal year) and regardless of how well you performed last year, you're back to square one in the new year with a new sales target which is no doubt 10% higher (or more) than last year. So that becomes your goal again.

Feeling inspired? Probably not.

In last week's blog we said the best sales leaders act like a thermostat and not a thermometer. Thermostat sales leaders set goals and targets that inspire their teams to get better in the areas that matter most. Thermometer sales leaders set a goal using historical data and stagnant targets based on outcomes.

What if goal setting was different this year? What if instead of "one size fits all" goals you set "one size fits one" goals uniquely tailored to your salesperson's developmental needs AND their sales revenue?

In my experience the "one size fits one" approach to setting goals is much more meaningful to a salesperson. They take ownership of their goals and it gives them a way to assess progress and update their plans with much higher frequency. So where do you start?

Glad you asked. I suggest you start by calculating each individual salesperson's unique pipeline requirements. And do this factoring in their activity requirements as well as their unique selling proficiency requirements as well.

Consider the diagram below:


Screen Shot 2019-01-21 at 1.24.50 PM


In this sense, selling is very much akin to other production jobs. A manager running a small manufacturing plant knows that in order to produce finished goods (sales), raw materials must be brought into the factory (activity). The rate at which finished goods will be produced is dependent on the operating efficiency of the plant (proficiency). The formula models the production that can be achieved given changes in any of the variables.

In sales, the underlying metrics associated with activity are the number of new opportunities identified and number of new proposals or quotes generated. The metrics associated with proficiency are closing ratio (the percentage of proposals converted to sales), the proposal rate (the percentage of new opportunities converted to proposals) and average sale value. We refer to these as the Predictive Metrics for selling.

Calculate Your Pipeline Goals Here


Andy Smith, SVP Sales & Marketing

For 24 years, Andy Smith has been helping some of the world’s leading sales organizations, including Honeywell, MasterCard, ExxonMobil, Microsoft, and others increase their effectiveness through improved sales process execution, better sales coaching, consultative sales skill development, and higher CRM adoption. Andy holds a degree from Baylor University and prior to joining AXIOM he served in senior sales leadership roles for Sales Performance International, AchieveGlobal, and Acclivus Corporation. He started his career in sales with Xerox before joining ExxonMobil where he discovered his passion for the sales performance improvement profession. Andy lives in Denton, Texas. Ask Andy about his very average golf game, radio broadcasting of high school sports, or his three adorable grand babies.

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Topics: Better Coaching

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