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High Impact Sales Management. …using modern approaches to dramatically increase your team’s sales performance. Profiles International. Founded 1990 700 offices in 90 countries 45 Regional Offices 45,000+ clients worldwide including:. The ‘80/20 Rule’ - Fact or Fiction?. - PowerPoint PPT Presentation
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High Impact Sales Management
…using modern approaches to dramatically increase
your team’s sales performance
Profiles International
• Founded 1990• 700 offices in 90 countries• 45 Regional Offices• 45,000+ clients worldwide including:
The ‘80/20 Rule’
- Fact or Fiction?
These take upthe slack for the
Bottom Performers– but are highly mobile
These pull sales out of the
organization and put pressure on everyone
Bottom Performersproduce 32% less than the
‘Average’ producers
Top Performersproduce 32% more than the
‘Average’ producers
Source: “The validity and utility of selection methods in personnel psychology: Practical and theoretical implications of 85 years of research findings” Psychological Bulletin, Sept 1998, Vol. 124, No. 2, pp 262-274.
‘Normal Distribution’
• 45 salespeople averaged 109% of target
• Top 10 averaged 125% of target (111% to 139%)
• Bottom 7 averaged 92% (82% to 99%)
More on this case study later…
Real Life: Novartis
• Just 14 Account Executives
• Dramatic performance gaps– Average sales of 3 Top Performers: $1.25M– Average sales of 3 Bottom Performers: $850K
More on this case study later…
Real Life: Data Service Organization
The Real World: Analysing Your Sales team
About Your Team
Let’s say you’ve a team of ten salespeople…
…each carrying a quota of $600K
Meet Your Team
• Tom $1,000,000• Mike $1,000,000• Tony $700,000• Dave $700,000• Sue $600,000• Amy $500,000• sherry $500,000• John $400,000• Charles $300,000• Brian $300,000
• Two you call probably ‘Stars’, right?
• Five you’d likely rate as ‘So-So’
• Three who’d generally qualify as ‘Passengers’
But what if you analyse their performance a little more closely?
Utility Analysis – A definition
“Utility analysis is a quantitative method that estimates the monetary value of benefits generated by any intervention based on the
improvement it produces in worker productivity.
Utility analysis provides managers information they can use to evaluate the financial impact of any intervention, including computing a return
on their investment in implementing it”
- Bernstein, Allen L. “A handbook of statistical solutions for the behavioral sciences”. New York: Holt, Rinehart and Winston.
Utility Analysis – Assumptions
1. Employees generate results that have monetary value to the organizations that employ them
2. Employees differ in the degree to which they produce results even when they hold the same position and operate within like circumstances
The implication is that the level of results produced by employees in their jobs have different monetary consequences for the organizations that employ them
Process Overview
• Rank your salespeople – top to bottom• Create performance tiers• Identify salespeople on each tier• Identify average sales per tier• Use this information to manage the
business
Your Team - Ranked
• Tom $1,000,000• Mike $1,000,000• Tony $700,000• Dave $700,000• Sue $600,000• Amy $500,000• Sherry $500,000• John $400,000• Charles $300,000• Brian $300,000
Create Performance Tiers
Add all sales results and divide by three
- to create performance break-points that will allow us to allocate our salespeople across three performance levels or ‘tiers’
• Tom $1,000,000• Mike $1,000,000• Tony $700,000• Dave $700,000• Sue $600,000• Amy $500,000• sherry $500,000• John $400,000• Charles $300,000• Brian $300,000
$6,000,000
Total Sales
Total Sales divided by three
$6,000,0003
= $2,000,000 per ‘tier’
Assign Salespeople to Tiers
Top Tier:Tom $1,000,000Mike $1,000,000
$2,000,000
Middle Tier:• Tony $700,000• Dave $700,000• Sue $600,000
$2,000,000
Bottom Tier:Amy $500,000
Sherry $500,000
John $400,000
Charles $300,000
Brian $300,000
$2,000,000
Assign Salespeople to Tiers
“Stars”Tom $1,000,000Mike $1,000,000
$2,000,000
Middle Tier:• Tony $700,000• Dave $700,000• Sue $600,000
$2,000,000
Bottom Tier:Amy $500,000
Sherry $500,000
John $400,000
Charles $300,000
Brian $300,000
$2,000,000
Assign Salespeople to Tiers
“Stars”Tom $1,000,000Mike $1,000,000
$2,000,000
“So So”• Tony $700,000• Dave $700,000• Sue $600,000
$2,000,000
Bottom Tier:Amy $500,000
Sherry $500,000
John $400,000
Charles $300,000
Brian $300,000
$2,000,000
Assign Salespeople to Tiers
“Stars”Tom $1,000,000Mike $1,000,000
$2,000,000
“So So”• Tony $700,000• Dave $700,000• Sue $600,000
$2,000,000
“Passengers”Amy $500,000
Sherry $500,000
John $400,000
Charles $300,000
Brian $300,000
$2,000,000
1. Hire Star salespeople first time?
2. Raise Passengers to So-So level?
3. Raise So-So Performers to Star Performer level?
4. Make sure I lose no So-So or Star Performers?
“So how do I…”
1. Make sure I lose no So-So or Star Performers?
2. Raise Passengers to So-So level?
3. Raise So-So Performers to Star Performer level?
4. Hire Star salespeople first time?
“So how do I…”
How might this be done?
32% less than average
sales
Average sales
32% morethan average
sales
These all looked the same when hired…
What do you miss?
Salesperson in interview
Here’s what you get!
Real Salesperson
…but traditional approaches do not work consistently well!
If traditional approaches worked you wouldn’t have an issue…
“It’s not experience – or college degrees or other accepted factors…
…(it) hinges on fit with the job.”
Source: Herbert M. Greenberg and Jeanne Greenberg, “Job Matching for Better Sales Performance, ” Harvard Business Review, Vol. 58, No. 5.
360,000 salespeople followed through sales careers over 20 years
0
5
10
15
20
25 Not Job Matched
Job Matched
Percentage of Top Performers in sales force
– Job Match vs. Non Job Match
“Six months after hire persons who had been job matched outperformed those who had not been matched.
“Moreover, the differences widened after 14 months”
Source: Herbert M. Greenberg and Jeanne Greenberg, “Job Matching for Better Sales Performance, ” Harvard Business Review, Vol. 58, No. 5.
Profiles Sales Assessment
Can she cope with the mental demands of your
sales environment?
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
Prefers time to think thingsthroughDeliberate approach to learning new skillsPrefer a more routine salesenvironmentLearns through experienceand repetition
Quickly understand client needs Fast problem solverAdapts quickly in fast movingnegotiations Effective communicator ofcomplex ideasFast learner
Learning, reasoning and problem solving approach
Learning Index
2211 4433 6655 8877 101099
Can she cope with the mental demands of your
sales environment?
Will she be comfortable in your sales environment?
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
Pessimistic‘Glass Half Empty’Challenges remaining Positive in face of rejectionSuspicious & critical of others
Endlessly Optimistic“Don’t worry, be happy”Deal with rejection easilyRelaxed social styleQuick to trust
Measures extent of positive outlook - of tendency to trust / expect the best of others
Attitude
2211 4433 6655 8877 101099
Finds networking challengingSmall talk doesn’t come naturallyHappy in own companyKeeps to oneselfNaturally reserved
Enjoy networkingConversationalPeople Oriented Need social contactComfortable in groupsEveryone’s ‘new best friend’
Social Style & Approach
Sociability
2211 4433 6655 8877 101099
Can she cope with the mental demands of your
sales environment?
Will she be comfortable in your sales environment?
Will she be motivated to sell your products &
services?
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
Little interest inentrepreneurial activitiesMay not enjoy negotiatingRecognition & status not soimportant
Enjoys entrepreneurial climateWants to leadLikes to persuade Interested in recognition & statusMotivated by entrepreneurialactivities
Interest in activities that involves persuading others, presentingideas & plans, and negotiating/deal-making
Enterprising
2211 4433 6655 8877 101099
• Can deal with the mental demands of their sales cycle position
• Are comfortable with the demands of the sales environment they work in
• Enjoy selling and are motivated to do it
‘Superior’ sales producers fit their jobs and:
“...(it) hinges on fit with the job…”
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
The JobMatch™
Pattern
Shaded areas indicate the JobMatch pattern
The JobMatch patterns show requirements for the sales positions in
your company
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
GoodMatch
Grey areas indicate the JobMatch pattern
Red boxes show the candidate’s scores
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Thinking Style
Occupational Interests
Behavioral Traits
Learning Index
Verbal Skill
Verbal Reasoning
Numerical Ability
Numeric Reasoning
Enterprising
Financial/Admin
People Service
Technical
Mechanical
Creative
Energy Level
Assertiveness
Sociability
Manageability
Attitude
Decisiveness
Accommodating
Independence
Objective Judgment
QuestionableMatch
Grey areas indicate the JobMatch pattern
Red boxes show the candidate’s scores
1. Hire Star salespeople first time?
2. Raise Passengers to So-So level?
3. Raise So-So Performers to Star Performer level?
4. Make sure I lose no So-So or Star Performers?
“So how do I…”
Critical Sales Behaviours
Critical Sales Behaviours
1. Hire Star salespeople first time?
2. Raise Passengers to So-So level?
3. Raise So-So Performers to Star Performer level?
4. Make sure I lose no So-So or Star Performers?
“So how do I…”
“In these days of Talent Wars, the best way to keep your stars is to know them better than they know themselves - and
then use that information to customize the career of their dreams”
-Source: Timothy Butler & James Waldroop: “Job Sculpting” Harvard Business Review - September-October 1999
1. Hire Star salespeople first time?
2. Raise Passengers to So-So level?
3. Raise So-So Performers to Star Performer level?
4. Make sure I lose no So-So or Star Performers?
“So how do I…”
Job Matched
Shield Your Targets!
Non-Job Matched
24%28%
5%8%
Low Turnover Industry
High Turnover Industry % left / fired after 6 months 46% % left / fired after 14 months 57%
% left / fired after 6 months 25% % left / fired after 14 months 34%
1. Make sure I lose no So-So or Star Performers?
2. Raise Passengers to So-So level?
3. Raise So-So Performers to Star level?
4. Hire Stars first time?
So what difference would it make to my $ results if I could:
Assign Salespeople to Tiers
“Stars”Tom $1,000,000Mike $1,000,000
$2,000,000
“So So”• Tony $700,000• Dave $700,000• Sue $600,000
$2,000,000
“Passengers”Amy $500,000
Sherry $500,000
John $400,000
Charles $300,000
Brian $300,000
$2,000,000
Calculate Averages per Performance Tier
Tier Averages
• Stars– Tom & Mike = $2,000,000 / 2 = $1,000,000
• So-So– Tony, Dave & Sue = $2,000,000 / 3 = $667K
• Passenger– Amy, Sherry, John, Charles & Brian = $2,000,000 / 5 = $400K
Use this information to manage the business
Difference between a So-So
and a Passenger?
So-So Average: $667KPassenger Average: $400K
Difference $267K
…every time you hire a Passenger instead of a So-So it costs $267K
…if you’d been hoping for a Star you missed by $600K (they average $1M)
…but let’s keep it conservative and focus on moving Passenger to So-So performers
So what’s your loss fromhaving Passengers vs. So So?
Remember, you had five:
Amy
Sherry
John
Charles
Brian
So Passengers represent a loss of $1.3M ($266k x 5) in sales…
…but what’s the premium for getting it right?
The ‘Getting it Right’ Premium• What’s the premium if:
– Raise one Passenger to So-So level?• $267K – total sales go from $6M to $6.27M (+4.4%)
– Raise two Passengers to So-So level?• $534K – total sales go from $6M to $6.53M (+8.8%)
– Raise all Passengers to So-So level?• $1.33M – total sales go from $6M to $7.33M (+22%)
…and these are sustainable ANNUAL increases – not one-off premiums
The ‘Getting it Right’ Premium
If we weren’t keeping it conservative you might ask:
“what’s the premium if all are Stars”?
Total sales increase by $4M from $6M to $10M (+67%)
Annually!
The Dark Side
This knife cuts both ways:
– Lose just one Star performer and replace with……a So-So – costs you $333K (per annum!)
…a Passenger – costs you $600K (per annum!)
– Lose just one So-So performer and replace with……a Passenger– costs you $267K (per annum!)
However you slice it – you cannot afford attrition
• The Challenge– 45 salespeople averaged 109% of target– Top 10 averaged 125% of target (111% to 139%)
– Bottom 7 averaged 92% of target (82% to 99%)
• What they did– Profile Identified the Key Characteristics of the Top (& bottom)
Performers• Provided a framework to identify top performers at the point of hiring• Provided a framework to raise everyone’s performance to Top
Performer level
• Results– Took product line from $1M p.a. to $1M per month in six months– 1st year total sales: $10.5M (projected $7.0M)– 2nd year total sales: $24M– 3rd year total sales: $34M
Real Life: Novartis Ciba Vision
• Benchmark pattern created of the top three performers
• All 14 reviewed against pattern
• Big difference between matched / non-matched people:– Matched: Average sales:
$1.31M– Non-Matched – Average sales: $840K– Average difference between selected and non-selected: $470K
…Which would you prefer to hire?
• Just 14 Account Executives
• Dramatic performance gaps– Average sales of 3 Top Performers: $1.25M– Average sales of 3 Bottom Performers: $850K
Real Life: Data Service Organization
Key Learning Points• Every sales team has uneven performance – Stars, So-So
and Passengers
• You pay dearly for So-So and Passenger level performance
• Your Stars share something in common – and that can be profiled
• That profile can be used to raise Passengers performance to So-So level, So-So to Star level
• This is a more enlightened way to manage for future sales success
• This is fast, easy and cost-effective to implement
• Initial Setup– Set up private online ‘Virtual Assessment Centre’– Profile all of your existing sales team– Feedback to all salespeople – Produce a Profile pattern for YOUR Stars– Run the whole team against that Profile– Create Sales Management reports for managers of each
team member – input on how to manage them up a tier– Run a workshop for managers on managing salespeople
up the tiers– Provide the facility to produce Sales Hiring Reports to hire
the best person next time
• Base cost of $X plus $X per salesperson
Typical Costs?
• The initial consultation will provide you with the potential gains in your team and is provided at no charge
• Our 10 person example would have cost $X
• Remember for that team moving:– One Passenger to So-So level: +$267K (+ 4.4%)– One So-So to Star level: +$333K (+ 5.5%)– One Passenger to Star level: + $600K (+ 10%)– All Passengers to Star level: +$1.3M (+22%)– All Passengers to Star level: +$4M (+67%)
….All sustainable direct-to-bottom-line increases
Potential Minimum Return?
• Set a consultation appointment with us before leaving
• Initial consultation is not chargeable – in that meeting we’ll :– Go through the process with you of analysing your sales– Create your Performance Tiers– Work out your ‘premiums for getting it right’– Quote you for implementation of Profile XT for your sales team
What Next?
Comprehensive Analysis of YOUR Team – your potential for sales increase
• Set a consultation appointment with us before leaving
• Initial consultation is not chargeable – in that meeting we’ll :– Go through the process with you of analysing your sales– Create your Performance Tiers– Work out your ‘premiums for getting it right’– Quote you for implementation of Profile XT for your sales team
• We’ll provide you with all the information you need to decide if this has a value for your organisation
What Next?
High Impact Sales Management
…using modern approaches to dramatically increase
your team’s sales performance