At the start of each year, the sales manager is given a sales quota, which is the total of their salespeople's individual quotas. For example, a sales manager with 10 salespeople who each have a goal of $1 million has a $10 million quota. A sales manager can only reach their sales quota by ensuring each member of their team reaches their targets.
If it is fair to judge a salesperson's effectiveness by their win rate, then it must also be fair to judge the sales manager's effectiveness by the percentage of their salespeople who meet quota. Many sales organizations demand their sales managers focus on internal work, making it difficult for them to spend time with their teams. This tension often finds the sales force on the losing end of a contest for the sales manager's time.
It's important for sales leaders and sales managers to acknowledge that looking at the scoreboard does nothing to change it. The only way to improve the score is by playing the game. Your sales force will play the game and score more points with a sales manager leading and coaching them. Let's look at four ways you can help your sales force hit their quota.
Building a Plan to Hit Sales Quota
It's important to understand how the quota is determined and why it is significant. It may be based on last year's number, or it may reflect a percentage increase the company needs to reach their large goal. One company I know has a quota based on the increase in market share in their territories. Your sales force needs to know why something like market share is important to the company's success. If you want your team to buy in, help them understand why and how their contribution matters.
Once the sales quota is understood, the second step is to develop a territory and account plan for each salesperson. This plan should include target customers, the ideal customer profile, and competitor analysis. It's also important to look at creating new opportunities inside the salesperson's existing accounts. Salespeople often look for one giant client that will retire their quota for the year, but this is a poor strategy. Your plan must ensure the salesperson has multiple paths to quota. One reason sales managers miss their sales quotas is because they spend too little time building a plan with each member of their team. After the plan is made, the third and final step is to execute the plan.
Ensure Each Salesperson Creates Enough Opportunities
One reason sales managers reach their quotas is that, often, a few salespeople consistently exceed their quota, covering the gap left by those who missed their sales goal. This isn't a strategy the sales manager should rely on for quota attainment.
The top reason a salesperson misses their quota is a lack of opportunities to be able hit their sales goal. The salesperson bears the responsibility for creating enough opportunities, but the sales manager who lets the salesperson go weeks or months without doing so is also largely responsible. No sales manager wants to have to nag their sales force to prospect, but if a salesperson isn't doing the work they need to create opportunities, the sales manager must intervene.
A lot of stakeholders stand to lose when a salesperson doesn't create enough opportunities to reach their quota. First, the salesperson suffers the loss of not hitting their target, and their family loses the income they failed to generate. Second, the companies in the salesperson's territory may suffer from poor performance because they haven’t received the help they need. This includes both new and existing clients that would benefit from more consultation. Finally, the salesperson's company goes without the revenue that was part of their plan.
There are sales activities that are non-negotiable. Prospecting is high on that list.
The second most common reason a salesperson might miss their sales quota is winning too few of their opportunities. One way you can help your sales team improve their results is by coaching them, especially through the large, strategic opportunities that will take a substantial bite out of their quota.
When coaching, sales managers should ask questions and help the salesperson think through what they need to do to win. They should also review the threats that may cause them to lose the deal. This takes time. To be able to coach opportunities, sales managers need to do their best to find the minimum viable engagement level for their internal work, the work the company needs from them, and spend the rest of their time coaching.
Sales leaders would do well to recognize that every task they assign a sales manager takes time and energy away from their sales force. You never see the owner of a sports team call the coach up to their box during the game to ask them to report. Filling up the manager’s time when they should instead be focusing on their team is no different.
Improving Each Individual's Effectiveness
I have a large competency model that comprises a huge number of character traits and skills. The list continues to grow as sales become more difficult. Some part of this results from our ACDC (accelerating, constant, disruptive change) environment. We seem to be going through a rough period, one plagued with uncertainty.
The role of the salesperson needs to change. It is more important than ever that salespeople need to be One-Up, meaning they must use their domain knowledge and experience to know more than their prospective clients. The modern salesperson must be a business advisor. Those who are not are unlikely to win opportunities, losing to One-Up salespeople. (See Elite Sales Strategies: A Guide to Being One-Up, Creating Value, and Becoming Truly Consultative.)
For managers, reaching their goal will require them to create a development plan that increases each salesperson's individual effectiveness. The salesperson who isn't adapting to the new environment will have a difficult time reaching their sales quota—and so will their manager.