Managing and measuring sales performance is an art that can be informed by science. There are 5 principles that evidence shows underpin quality sales performance measurement systems.
The more control sales people have over the measures of their performance the more effective the measures will be.
Performance measures need to be aligned with the strategy in order to encourage the expected behaviours and avoid the phenomenon known as “rewarding A, while hoping for B”.
The number of performance measures used needs to be relatively small, ideally seven, plus or minus two.
Sales people need to participate in the definition and accept the performance measures that will be used for assessing and rewarding their performance.
Sales people need to understand how their performance measures are calculated and what they mean for better behavioural results.
Using those principles you will likely achieve better sales outcomes as well as higher satisfaction of your salesforce.
Our work in this area is critical to achieving successful sales leadership program for individuals and organisations looking to achieve higher levels of strategic leadership. For the past twenty years, Cranfield has pioneered the development of Sales and Key Account Management research in Europe through the KAM Best Practice Forum. Working with world leading businesses to adopt new frameworks to fully leverage sales strategies. This new frontier knowledge is continually integrated into our Sales Directors' Programme.
Blog produced by: Dr Javier Marcos, Programme Director of the Sales Directors’ Programme, Cranfield School of Management.