Rating Systems: Do they Improve Performance?

Rating systems have been relied upon for years to improve performance. Often times a person’s career, pay raise or job is in the balance.

How effective is your performance management rating system?

A  study published in the Journal of Applied Psychology sheds a not too flattering light on rating systems and what they really measure.

“The most comprehensive research on what ratings actually measure was conducted by professors Mount, Scullen, and Goff. In their study, 4,492 individuals were rated on a number of different performance dimensions by two bosses, two peers and two subordinates, who combined to produce almost half a million ratings. The researchers then analyzed these ratings and discovered that 54% of the variance in the ratings could be accounted for by “idiosyncratic rater effects”—namely the peculiarities of each individual rater’s perception. Only 21% of the variance in ratings could be explained by the ratee’s actual performance. All of which led the researchers to the following conclusion:

“Although it is implicitly assumed that the ratings measure the performance of the ratee, most of what is being measured by the ratings is the unique rating tendencies of the rater. Thus ratings reveal more about the rater than they do about the ratee.”

Scullen, S., Mount, M., & Goff, M. (2000). Understanding the latent structure of job performance ratings. J Appl Psychol., 85(6), 956–70.

What’s your experience been with rating systems in your organization? Do you feel they are worth the time and effort?

Developing Salespeople: Creating a Coaching Budget

Developing salespeople is like saving for retirement. If you don’t create  a realistic plan and invest accordingly you’ll be disappointed when you retire. Salespeople need a plan and an investment of time and energy in order to help them realize their full potential. Too often training and developing salespeople becomes a “round to it” for sales managers because they have other more pressideveloping salespeopleng things to do…like paper work and meetings. This is a mistake you can’t afford to make.

Another mistake sales managers make is treating every salesperson the same. This article will help develop salespeople while getting the most from each salesperson and your time.

Developing Salespeople

Each salesperson will require different approaches and need varying amounts of time.  Since you can’t be all things to all people, you must assess where your management time will bring its greatest return.  This means you must allocate your coaching time to make sure the people who have the greatest need and potential receives the most time.  The people who have the least need and represent the smallest potential for improvement receive the least time.

To make sure that you effectively allocate your time properly you’ll need to take the following actions:

      Create a Coaching Budget — To help you determine how much time you have available to spend with your people. For example if there are 240 work days and you want to spend 60% of your time coaching salespeople then your budget is 144 days. The results you get from developing salespeople are determined by how you spend your coaching budget.

      Assess each salesperson — When assessing salespeople you want to focus on their skills, knowledge and attitude. Make sure that you assess for  both the needs and potential of your people.  This will help you to spend the most time where the need and potential is greatest.

      Allocation of Coaching Days — Based on your assessment you now must commit your time to ensures that each salesperson gets an optimal amount of coaching time.  The key to setting priorities in this situation is to ask these questions “What will happen to performance if I don’t spend time with the salespeople?” and, “What will happen if I do?”

      Coaching Calendar — This formalizes your allocation of coaching time.  Since coaching time is the most important activity you can perform schedule it in your weekly and monthly plans first.  Then schedule other activities around your allocated coaching days.  Doing so will help prevent you from getting bogged down doing unimportant but urgent tasks instead of spending time with your people.

Developing salespeople won’t happen unless you make the time to do it. There are always going to be activities waiting to steal your time and distract you from your most important responsibility. If you want your salespeople to be peak performers then create your coaching budget and stick with it. Committing your budget to your calendar helps create the necessary discipline to make it happen.

If you’d like more information on creating a coaching budget and developing salespeople check out my eBook “Coaching for Peak Performance”. 

Developing Salespeople with Effective Coaching

Developing salespeople doesn’t happen automatically. Many sales manager never invest the time and attention to do so and end up paying the price in turnover and poor sales. Developing salespeople requires you to understand and apply a simple yet powerful coaching process.  This process involves three steps. They are:developing salespeople

1.    Recognize coachable moments. Coachable mo­ments are specific opportunities where coaching is most likely to make an impact. Coachable mo­ments fall into three ar­eas:

  • When sales­people perform well;
  • When sales­people fail to per­form; and
  • When salespeople seek help.

2.    Engage. This means taking the coach­-able mo­ments and turning them into performance discus­sions. These performance discus­sions should be brief, very fo­cused, and viewed as helpful by salespeople. These are great  opportunities for developing salespeople.

3.    Mobilize. To effect change, man­agers must con­vert the perfor­mance discussions into actions. These actions can be comprehen­sive (e.g., devel­op­ing a key ac­count plan) or focused (e.g., use visuals during a presentation). Developing salespeople requires that you monitor your salespeople’s progress with the actions you assign.

Coachable Moments

In order to get peak performance from your salespeople you have to use every opportunity to develop their effectiveness. You as a coach must recognize and respond to coaching opportunities as they present themselves. This means using a different approach with each coachable moment. We’ll discuss each one separately.

When salespeople perform well.  Your objective in this situation is to reinforce the salesperson’s positive behavior. This coachable moment is often overlooked because many managers feel that salespeo­ple don’t need positive reinforcement. Unfortunately, this is a faulty assumption. Reinforcing positive behavior increases the frequency of the behavior. If you fail to reinforce positive behavior, it will occur less often.

When you want to reinforce or praise the perfor­mance of a salesperson, use the BIT Model.

B= Behavior Describe what the salesperson is doing that is positive.

I= Impact Describe why the salesperson’s perfor­mance is important and how it contributes to the organiza­tion.

T= Thank You Deliver a specific expression of appreciation.

An example of giving a BIT would be: “Making those extra calls this month has really paid off. Your 20 percent over budget really helped us get over the top this month. I really appreciate the extra effort you’ve put in. Keep up the great work!

When salespeople fail to perform. Your objective for this coachable moment is to give feedback and help salespeople improve a specific area of their performance. Giving negative feedback is not always easy, but it is necessary for improvement. To mini­mize the potential of causing salespeople to become defensive and not motivated, make sure your feedback is specific, focuses on behavior, and helpful. Using the BIEC Model should help you do so effectively.

B=  Behavior-Describe what his/her behavior is doing or not doing that needs improvement.

I= Impact-Describe how the behavior is impact­ing performance.

E=  Expectation-Explain what you expect the salesperson to do or not do to change.

C=Consequence-Explain what will happen if the salesperson changes or the consequences if the behav­ior continues.

He­re’s an exam­ple of the BIEC Model:  “Mary, this is the fourth time this month you’ve submitted sales orders with incomplete or inaccurate informa­tion. When you do this, the order has to be re-written and reprocessed. This adds to our costs and delays the order from being pro­cessed. Delays in orders can lead to lost sales and dissatisfied custom­ers. From now on, I expect your orders to be submit­ted with all the information complete and accurate. Doing so will make it easier to process your orders and keep your customers happy. Also, we can’t afford to jeopardize business because of poor paper­work. If there are future prob­lems, we’ll have to review your account list”.

When your salespeople seek help in solving a problem or maximizing an opportunity. Too often, managers solve their people’s problem instead of managing the problem-solving process. Managers take this approach because it seems the most expedient. In the short run, it probably is. But in the long run, the approach creates salespeople who are dependent on their managers. If you want to develop salespeople who take initiative, accept responsibility, and hold themselves accountable, then remember, the goal of this coachable moment is to support their efforts, not solve their problems.

Using the CEAC Model will help you draw your salespeople out and identify how you can best support their efforts.

C= Clarify the problem or opportunity.

E= Engage in a discussion of what options are available to address the issue.

A= Agree on actions to be taken with deadlines (What, by when and by whom).

C= Commit your support to the initiative.

Summary

Developing salespeople with effective coaching is an investment that requires both time and effort. A few minutes before and after a sales call or while a salesperson is developing a proposal can pay huge dividends.  Therefore,you must view coachable moments as opportunities to make a difference, not a distraction from your job.  Remember, sales managers who are constantly looking for oppor­tunities to make a difference, generally do. So, don’t let your coachable moments go unful­filled.

Developing Salespeople While Coaching on the Run

One of the biggest casualties in the battle to “do more with less” is developing salespeople. With fiercer competition, shorter deadlines, and the urgent replac­ing the important, sales managers are starting to view developing salespeople as a luxury they just can’t developing peopleafford.

Although common, this approach to manage­ment is short-sighted and can lead to long-term disaster. Even with more demands on your time you must realize that developing salespeople isn’t something you do instead of your job. It is your job!

This means finding opportunities to make a difference as they present themselves.

The key to coaching on the run is the “hand in the bucket” test. When you put your hand in a bucket of water, the water level rises.  This is the case when a you spend time with a sales­person. While you are present, the sales­person’s level of perfor­mance is elevated.  The real test for developing salespeople occurs when you are no longer present. Does the salesperson’s performance return to the previous level, or does it stay elevat­ed?  In other words, did you leave something with the salesperson to make a real and lasting difference?

Before we discuss some of the specific aspects and techniques for coaching on the run, let’s review what it takes for salespeople to perform at their optimal level. Use the checklist below to determine if you’re giving your salespeople what they need to win.

Coaching Checklist for Developing Salespeople

  • Do your people have a clear understanding of what they are expected to do?
  • Do your people have clear standards for ac­ceptable performance?
  • Do your people have the authority and re­sourc­es to perform effectively?
  • Do your people encounter little task interfer­ence (e.g., conflicting goals, objectives, procedures,   etc?)
  • Do your people receive timely and accurate feedback on their performance?
  • Do your people receive positive conse­quences and reinforcement for performing the job as it’s supposed to be done?
  • Do your people experience negative conse­quences when they fail to perform?

These guidelines apply to performance in general, as well as specifics tasks and assignments. Use the questions to assess your coaching abilities and to analyze performance problems.

Each “no” represents a potential performance problem for developing salespeople. Taking action to convert your “no” respons­es to “yes” will go a long way toward improving your people’s performance.

Sales Training Guidelines

If you want to increase the effectiveness of your sales training use these simple but powerful guidelines.

Managers who view training sessions as merely a series of skill and product training exercises will fall short of providing a sales training guidelineswell-rounded training experience.  Salespeople also need feedback on how they’re doing, measures of adequate and maximum performance, and persuading that they’ll benefit from it all in the long run.  In fact, every training session should be structured so as to answer the following six questions for Salespeople:

  • What am I supposed to do?
  • How is the job supposed to be done for maximum effectiveness?
  • What is acceptable performance?
  • How well am I doing?
  • How can I do better?
  • What’s in it for me if I do?

We, therefore, recommend that you follow the Seven-Step Sales Training Model outlined below.

                                    SEVEN-STEP SALES TRAINING MODEL

1.   Explain. Tell Salespeople what will be covered, how it is to be done and why.

2.   Ask. Have them describe their understanding of what will be covered.  Remember, if they   can’t tell you, they don’t know.

3.   Demonstrate. Provide a “model” showing proper technique.

4.   Observe. Allow them to try out the same behavior (either in a simulated or real situation.

5.   Feedback. Give them meaningful feedback to reinforce the positive and identify areas they need further improvement.

6.   Plan. Engage them in a planning process that outlines the specifics of how and when they will practice and apply the new behaviors.

7.   Follow-up. Always review the results of their development activities.  Use the Results to adjust future training activities.

These guidelines are simple, practical and proven. Make sure that you incorporate them into your sales training efforts. You’ll be pleasantly surprised at how your salespeople respond and more importantly how they perform.

Sales Coaching : When Do You Step In on a Sales Call?

A common problem on coaching calls is the sales manager taking over the sales call or “stepping in”. Sales managers often ask “when is it appropriate to step in?” Some of the most common reasons given for stepping in are:

• The salesperson is really in trouble

• The salesperson has made a major mistake

• The salesperson is about to lose a sale

• It’s a very big sale

• The salesperson can’t handle the customer

Although all of these are very compelling reasons for stepping in, they are merely a symptom of a much bigger problem. If you have to step in on a coaching call, it’s a signal that you have failed as a coach on that call. Stepping in prevents the salesperson from developing his/her selling skills and it prevents you from being able to fully exercise your coaching skills. Once you step in, you are no longer an objective observer, but an active participant. This severally limits your ability to focus on what the salesperson is doing right or wrong. When you step in, you are telling the salesperson that this call is more important than his or her development.

If salespeople aren’t ready to make a call on their own, then make the call a joint call or a training call. But, if you agree that it’s a coaching call and salespeople are responsible for the outcome, then let them succeed or fail on their own merits. Your job at that point is to make sure your salespeople have learned from the experience.

Increase Sales with Curbside Coaching

To be a successful sales manager and increase sales you must learn how to  effectively perform curbside coaching.

Every sales call presents “lessons to be learned”. Salespeople who learn  these lessons best develop their capabilities and improve their performance.  Those who don’t or can’t learn the lessons find themselves doomed to mediocrity  or failure.

Your job as a manager is to make sure your salespeople benefit from each call  they make. The best way to do this is during the post-call coaching session,  sometimes called “curbside coaching.”

When to Do It?

The best time to give feedback is immediately after the  call. At this time, the details of the call are  still fresh in your mind and the mind of the salesperson.

However, there are times when you can’t immediately curbside coach. If this  is the case, be sure to jot your thoughts down on paper so you can discuss at a  later time.

What Should a Coaching Session Accomplish?

The obvious answers are for the salesperson to recognize what they right and  understand ways to improve. However, there are several other objectives that the  session should achieve.

Have the salesperson:

• Assess the extent the salesperson achieved the call objectives

• Recognize what factors favorably influenced the outcome of the call

• Recognize what factors negatively influenced the outcome of the call

• Identify other actions that could have made the call more effective

• Determine what follow up actions are needed

The coaching session should also enable you to:

• Assess the salesperson’s ability in planning, implementing and analyzing a  sales call

• Reinforce the salesperson’s strengths

• Identify areas for you to work with the salesperson

• Improve your relationship with the salesperson

• Gain insight into the types of issues your salesperson is confronting in  the field

Salespeople need coaching to be at the top of their game. Invest the time  after every call to develop your salespeople and increase sales with curbside  coaching.

 

Sales Training for Improving Sales Performance

improving sales performanceImproving sales performance is an ongoing challenge for sales executives and business owners. One tool available for accomplishing this goal is sales training. Sales training is an option if you need to change salespeople’s behavior or improve their skills. Ultimately, sales training must produce good performance to be worth the time and resources it takes to  accomplish.  Salespeople are successful if they do most of the right things most of the time.  Think of the 50%-70%-90% rule.

  • 50%ers People who perform only 50% of the right things 50% of the time are average to below
    average salespeople.  Their performance suffers because they consistently fail to take many of the steps necessary to be successful.  50%ers are either people who haven’t learned what to do, or experienced people who lack the motivation to do what they know how to do.
  • 70%ers People who perform only 70% of the right things 70% of the time are average to above average salespeople.  These salespeople use most of the skills most of the time, but they periodically skip a step or take short cuts.  During short periods of time, they may perform like top performers. But, in the long run, they skip enough steps to prevent them from rising to the top.
  • 90%ers People who perform 90% of the right things 90% of the time are top performing salespeople.  They attain uniformly high
    performance because they consistently apply the skills without skipping steps.

Your role as trainer/manager, is to identify and then to train and reinforce salespeople to do the right things more frequently.
This will lead them to do the right things more effectively.  Perhaps, improving sales performance in the long-term is the hardest part of the training process.  You must become aware of the importance that recognizing and rewarding good performance plays in building self-confidence and motivating salespeople to reach higher levels of effectiveness.  Practice the following simple guidelines for enhancing post-training performance through positive reinforcement:

  1. Give positive reinforcement in a timely manner, as close to the performance as possible.
  2. Give recognition that is meaningful to the salesperson.  Giving recognition that is not meaningful or that may even be viewed as a punishment by the salesperson will decrease performance.
  3. Be specific by pinpointing the exact behavior that you want to reinforce and explaining how the behavior benefits the salesperson.
  4. Don’t wait for outstanding performance before you recognize a salesperson.  Recognizing even small improvements will
    encourage salespeople to continue their efforts.  This is particularly important with new salespeople and your poor performers.
  5. Be honest and accurate.  Don’t use superlatives all the time or salespeople may view your efforts as insincere.

Training rarely produces long term performance impact unless it leads to changes in the salesperson’s behavior. This requires practice, reinforcement and commitment. If your goal is improving sales performance you must make a commitment to training.