small to midsize companies I work with don’t have a sales plan. Most
mistakenly believe that salespeople are internally motivated and directed
where it is unnecessary or over-kill. When a sales organization has
100% commission salespeople, it fails to put together a sales plan because
it doesn’t believe it can control or influence an independent sales
biggest reason sales organizations don’t take the time or the effort
to do a sales plan is because it is time-consuming on the front end
and time-consuming on the back end. It takes real commitment and a disciplined
approach to put together an effective plan.
of the personal nature of a sales plan, such as aspirations, income
targets and lifestyle goals, most managers are not accustomed to or
comfortable digging deep into the heads of their salespeople. They don’t
realize that emotions are some of the key drivers of salespeople.
companies have a loosely knit sales figure to aim for, but generally
they don’t go beyond that. A good sales plan is enforceable and holds
salespeople accountable. Too many companies fear a defined sales plan
because they will have to face the stark reality that they have some
non-performing salespeople who are costing them money and they are not
willing to act on it.
they did act on it, they would have to play the enforcer role and they
would rather spend the extra money (income, benefits) to let it slide
and hope that the salesperson will leave on their own or they will naturally
correct themselves through their own devices.
salespeople can be a thankless job. That is why there are few talented
sales managers. Companies too often mistakenly take their best salesperson
out of the field and make them sales managers. This often falls short
because of the lack of experience of the sales manager.
major reason that sales plans are not instituted or properly executed
is because once you see the writing on the wall for certain underperforming
salespeople, you need to start recruiting and hiring again. Companies
have an attitude that the devil you know is better than the devil you
that you know some of the real reasons companies don’t use sales plans,
let’s look at the internal dynamics of what makes up a sales plan.
three major parts are:
- Personal Goal Setting
- Formalized Sales Plan
- Monthly Reinforcement and Accountability
forecasting coupled with a well thought-out and detailed sales plan
can help companies avoid problems, anticipate problems, plan for growth,
identify new markets, and provide direction for its salespeople. It
also can help manage staff, production, and cash flow needs more effectively.
Although it requires an upfront investment of time and effort, it ultimately
will help companies spend more time creating their business rather than
reacting and constantly putting out fires.
good sales plan works to improve shortcomings in the past and capitalize
on growth opportunities for the future. It gets your salespeople to
focus their attention on growing their major accounts, spend less time
on non-productive activity and focus on how they can grow new accounts.
Once accomplished, it is easier for management to lead, manage, track
and make tough decisions on better data.
Personal Goal Setting of Salespeople
key characteristic of high performing salespeople is they have written
goals which have a goal date, and those are monitored and changed annually.
Because salespeople come to work each day for their own reasons and
not for management’s reasons, personal goal setting is the hallmark
of a successful sales plan. Salespeople are competitive by nature and
having them focus on their personal goals and using their career to
help them achieve these goals can only help them to be more focused
and motivated. Once they home in on all income goals and materialistic
goals, they can use this as their own personal benchmark for their professional
revenue goals and activity goals.
following are some of the more obvious areas that should be considered
for a complete goal package:
Goals: What new possessions do you want?
Goals: What destinations?
Goals: When, where and how much?
Goals: What can you do to enhance your profession?
Goals: How far, how high and with whom?
Goals: If you had the time and money, what would you like to do?
Goals: What is important to you to do with your life, spirituality
and with your family?
Goals: Professionally and personally
Goals: How much? What are your 5, 10, 15, and 20-year plans?
- Health and Beauty goals: How do you plan to stay healthy?
make things easy, each goal has a stated mission, a due date and a specific
plan. Some goals will have a few objectives and others will have many.
Formalized Sales Plan
on your benchmarks, a sales plan should have an overview for each salesperson
and their territory or account base, followed by a specific account
overview should include threats, opportunities, present situation, competitive
analysis, and trends.
account analysis should include two major categories: existing
accounts and new business. Within each category there should be a breakdown
of A/B/C accounts. Information should be exact and to the point. "Less
is more" is a good standard.
following are suggestions for the account analysis:
- Last year’s volume
- Market share or total opportunity
- Sales projection
- Key contacts
- Number of sales calls made last year to that account
- Number of sales calls projected for this year to that account
- Type of account (A/B/C)
- Goals, strategies and plans for this account
key for management is to locate where salespeople are wasting their
time, spending too much time or too little time, calling too high or
too low, existing business/new business ratios, and validity of overall
Monthly Reinforcement and Accountability
is recommended that you review bi-annually and annually your sales plan
with your salespeople. Review the key benchmarks as to where they are,
year to date, and what revisions and changes they have to make to be
on target with their goals. This should be done on a one-on-one basis.
sales organizations, when they do sales meetings, will run them anytime
from weekly, monthly, or quarterly meetings. Unfortunately the meetings
are bull sessions, product updates or just internal reporting. There
is not enough time spent on accountability and helping the salespeople
manage their activity, accounts, and goals.
most important exercise a manager can do with their group is monthly
pipeline reviews. This status report has each salesperson detailing
their immediate and long-term deals that make up their active pipeline
of deals. Effective managers have a defined systematic process
to use that is not arbitrary and does not just ask, “Where are
you with your goals this month?”
key elements cover the main revenue benchmarks that the salesperson
has committed to. Typically they are monthly or weekly activity (dials,
people reached, appointments, quotes, referrals and sales) and an outlined
progress report for all the deals they are forecasting in their pipeline.
progress report or forecast will differ for every company because everyone
has different benchmarks or priorities to measure. The following is
a description of some of the key elements to track in the sales process:
- Motive for change: What are the customer’s problems, what are
the costs and what is the tolerance for change?
- Investment: Is the customer willing to invest time, resources,
and money to address their problem? What is the timing for change?
- Decision process: The who, what, where, when, why and how.
What are the steps for change and timetable for each step?
- Solution: When and what will be the solution?
- Closure: What is the timing for a decision?
companies might have more steps. The point is to at least include the
preceding which will be universal for just about all sales situations.
As you take your salespeople through each of these steps, you no longer
have to rely on forecasting information like, “They really like
me, and I’m their guy. I know they have the money and I’m confident
we have this one.” It is not a bad idea to assign a percentage
for each step or define the key benchmarks in the sales process.
can now be very clear for each account the salesperson is forecasting
as to where they are, what they have done right, what they have done
improperly, what they need to do next, what is the percentage of closure
and what can the salesperson do to repeat or prevent what they have
done so far for the future.