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When to SPM: How to Know it’s Time to Make the Move Or Live Without It!

183:906269490 • February 17, 2023

Does it make financial sense for your organization to invest in sales performance management software?

The complexity that comes from managing a sales force isn’t lessened just because you’re working for a small business. When it comes to keeping track of targets and objectives, territories, training, implementing incentives, tracking activities, and reporting, you have all the requirements of a large-scale enterprise with the unfortunate dilemma of having to make compromises when it comes to how you manage it all.


So, if you’re in the position of wondering whether it makes sense for your organization to invest in some sort of sales performance management or incentive compensation software, keep in mind this Tony Robbins quote:


Change happens when the pain of staying the same is greater than the pain of change.

 

In this case, the “pain of change” is not only the time and effort required to choose, implement, and onboard an SPM but also the sheer cost involved. Annual costs associated with SPM software can be quite extensive. Forrester identified costs that included the annual recurring license fees, administrative costs, support fees, internal implementation and planning time and expenses, professional service fees, and training costs, amongst others.


The “pain of staying the same” will look different to each organization, but ultimately it will have to do with the salesperson’s experience and the increased probability of errors like under/over-paying or missing payout deadlines. As a leader of people, the pain points might include:


  • Lack of visibility to performance
  • Lack of transparency and trust in the process
  • Discontentment from salespeople or confusion about their roles
  • Inconsistencies in compensation practices
  • Lack of follow-through on incentive ideas
  • Stress from keeping up with everything yourself
  • Difficulty paying out consistently and on time


You’re likely experiencing some of those issues, but do they justify the expense of an SPM? Only you can answer that, but I can tell you that there will come the point when the cost of the SPM feels well worth the value it brings.


If that time is NOT now...


Here are some ways you can implement efficiencies in sales performance management.


Be Transparent


Your sales team should not only be clear on their individual sales goals, but they should also know their role in the larger organizational strategy. This will not only help them stay motivated, but it will also open the door for creative thinking from minds other than your own. Being a leader doesn’t necessarily mean coming up with all the ideas yourself. Don’t take this for granted. We all want to be part of something greater than ourselves and can get lost in the mire of the day-to-day grind of work.


Transparency also builds trust and improves relationships among the teams. This first step will be needed to develop trust if the desire is to ultimately create a fair and inclusive sales program.


Make the most of Document Sharing


You may prefer a whiteboard on the sales floor of your organization to keep visibility on target tracking and keep everyone motivated. However, if your organization—like most organizations—includes some remote employees, you may not be able to count on in-office visibility to keep your sales team up to date.


Make sure your documents and spreadsheets are shareable in real time. Using Google Docs, Smartsheet, Microsoft Teams, or SharePoint allows multiple people to interact with a document simultaneously. You can establish document linkages and security parameters in these environments quickly and easily for sharing sensitive information or making it wide open for public rankings.


Process Reminders

 

Remember that just because your documents are shareable doesn’t mean everyone is going to remember to look at them regularly. When you don’t have system automation, routine is your best friend. Many team management apps, like Slack, give you the ability to create automated reminders.


Beyond that, you can create personal routines and calendars that help you get in the habit of reminding, checking up, and communicating.


Share Responsibility


Ask your sales reps to take ownership of seeking feedback as well as providing analysis of their results and offering creative solutions to problems they encounter. This doesn’t take the burden off your shoulders as the sales leader, but it does lighten the load a little. Of course, not every salesperson will step up to the challenge of managing themselves, but you’ll definitely get good insights into each of your team members by asking them to take greater accountability and ownership of their success.


While you may wish you could afford to invest in SPM software, you can ease the “pain” of sales performance management by implementing some good habits and seeing your salespeople as partners who can contribute.


By 183:906269490 December 16, 2024
In my first Best Practices post, I talked about the importance of knowing what you can pay for your sales roles before worrying about what the market is saying. In my second post, I covered ways to utilize culture in a sales organization . The following Best Practice in sales compensation involves job content. Job content plays several roles in your compensation plan: 1. It gives your salesperson a guide to what success looks like in their role. 2. It gives you a guide to evaluating the performance of your salesperson. 3. It rationalizes differing levels of variable pay outcomes for varying performance levels. 4. It provides your organization with the structure needed to comply with any reporting, pay transparency, or other regulations. Hopefully, that’s enough to convince you of the importance of taking the time to define your new roles and revisit the definition of your existing roles. Now, here’s how job content actually does those things. Defining the job The first role of job content is to define the who, what, where, when, and how of the function. It can be tempting to borrow a job description from LinkedIn, Glassdoor, etc., with the assumption that the content will be similar enough to fit your needs. However, the way a specific role performs is unique to the organization it’s acting in, which is why it’s important to take the time to define the job from scratch. Here are the questions you should be answering in your job content: What does the person need to do on a daily basis? How does this individual pursue sales, and in what segment or with what type of customer? Where should they focus their time and attention when building a pipeline of deals? Who should they be interfacing with, both internally and externally? When do they engage with customers and/or prospects? What portion of the sales process do they own or support? How do they interface with and influence decision-makers? Now, even though I said to write your job description from scratch, that doesn’t mean this is the time or place to get too creative. Job seekers are going to be searching by job title or category, so it’s essential to stick to the common vernacular regarding industry jargon and expected job titles. Job Description: A Byproduct of Job Content Another positive outcome of creating job content for your roles is that you will have generated much of the information needed for a job description if or when you’re ready to hire. Information such as: Job duties and responsibilities that clarify the type of work and engagement with customers. Qualifications/Requirements that are both minimum and desired. Those include education, knowledge, skills, capabilities, and competencies. Performance measures of the role include items like achieving sales targets, new logo acquisition, development of pipeline, accuracy in forecasting, etc. With all of this information on file, it will not only be easier for you to prepare to hire for the roles you want, but it will also be easier to evaluate existing employees in those roles. Beyond all of that, you’ll be well prepared for competitive market research and establishing your variable pay program. I’ll be posting more best practices on the blog, but if you’re anxious to dive deeper into the subject of sales compensation, you can grab a copy of my book Starting Simple: Sales Compensation and consider working through the companion Workbook to build a sales compensation plan from scratch.
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