Sales Compensation Blog

The chart below shows an example of the performance distribution curve for a successful sales organization, where about 70% of the sales team is making or exceeding quota. Attainment levels are distributed evenly along a bell curve, with just a few underperformers and overperformers.

In our most recent web seminar we asked our attendees if their reps were making quota. Most had a majority of reps below quota. Compared to the evenly distributed bell curve above, their performance distribution curves may look more like the one below, with just a few sales "superstars", and everyone else underperforming.

Sales reps want to win and judge themselves on achieving specific goals. So when they don't make quota, they become highly discouraged and unmotivated. So if your organization's attainment curve is similar to the one above, how do you turn a team of stragglers into a team of winners?

1. Evaluate the sales team skills. Do the reps have the proper skills and training to do the job? You may need to provide sales or product training for the reps.

2. Make sure the quota is realistic. Can most of the reps make it? Is the growth rate or recover rate realistic? Don't be optimistic when setting sales quotas. To keep your sales reps highly motivated, design a sales compensation plan so that at least 50% of your reps reach or exceed quota.

3. Review quota allocation. Did the company give the managers' one number and the reps a higher number? You should strive to fully allocate your quota. That means if the company has a $10m goal and 10 reps, the reps quota should be $1m each - not $1.3.

4. Evaluate your quotas and territories. The reps that are significantly over their quota may just be in a very rich territory and they may not be able to fully support the potential customer base - leaving sales on the table.

5. Look at your internal processes. Are they slowing down your reps? Are the reps spending valuable chasing paper within your organization when they should be making sales calls? Time to evaluate the process.

6. Analyze the lead generation engine. Determine if it's creating enough of the right types of leads. Is it matching the strategy that was used to create the quotas?

Whether your sales comp plan needs adjustment or other factors come into play, your efforts to create a team of winners, will (literally) pay off.

To learn more about motivating your team, join us for a free webinar on April 6,  "Create More Sales Superstars and Exceed Your Corporate Goals". 

If you read Liz Cobb's recent post titled "Is your sales team a team of winners," then you know best practice states that you want to allocate targets such that 60% of your team is at or above quota. You also want your sales force striving to achieve Winner's Circle status, and more importantly, the title of ‘Top Sales Rep.' When you have a good portion of your reps in this position it encourages behaviors that you want from your team:

• Stimulates healthy competition and camaraderie amongst the team,
• Creates more energy and excitement as the year winds down
• Ensures a diligent work effort until the final numbers are tallied

Is your Winners Circle too Easy?

You may feel the Winner's Circle is either too easy to achieve at this level or not deemed special enough by having more than half of the sales force achieving Winner's Circle status. After all, you want to make this achievement prestigious and only reward your top most performers. In this case, set the Winner's Circle goal at a figure somewhere over 110% of quota. This will ensure that only your top performers are rewarded with that special trip or reward. Let us know what works or does not work for you.