In business to business transactions that have a complex sales cycle, salespeople are likely to be involved in the process. Therefore, salespeople provide a vital function for many companies. This subject matter of this piece is what makes high performing Salespeople.
There are many viewpoints for discussion: The customer’s, the seller’s or the sales leaders. Should these viewpoints be unique? Perhaps not – but in this case, I am focusing on the perspective of the salesperson and sales leadership with regards to delivering high levels of financial performance against target.
In sales job interviews, the interviewer and the interviewee try to convince each other that they can make money at the company. The interviewee states that making money is their top priority. The stock question is what motivates you? The “right answer” is money.
In 20 years of sales, I have seen only a small percentage of salespeople that are truly money motivated. Of course, those few are very successful.
But surely, all salespeople are motivated by money? Money is always a motivating factor for any profession. We all need money to live – it’s inescapable.
The motivation provided by money refers to the positioning of the individual’s financial comfort zone. Those we define as being motivated by money are rarely satisfied with any sum presented to them. But for most people, reaching a financial comfort zone is much easier. In most cases, this sum is not that far above their basic salary. Once someone has achieved earnings within their comfort zone, money no longer motivates them.
A common issue in sales is performance against target. Most companies present a 50:50 OTE (on target earnings), in other words, salary is made up of 50% basic and 50% commission. The problem lies in the fact that people are often satisfied (can survive) with earnings just above their Basic. Therefore, many people do not have a personal need to meet or exceed their targets unless their employer threatens their job by missing.
If employers budget to 75% of rolled sales targets, then any sales person delivering greater than 75% of target is above budget. In other words, while the company may not overly reward individuals missing their target, they live with it. If this is the case, most companies must be unsatisfied with productivity!
To combat the lack of sensitivity to personal financial targets companies create alternative rewards systems. For example, it’s common for businesses to offer President’s Club holidays. Unfortunately, these incentives are won by those people that exceed their targets and are motivated by financial rewards.
Motivating Salespeople to high performance represents a significant issue for most companies who employ salespeople. What is the difference between the money motivated and the rest? How do I motivate the financially unmotivated?
What is different about the people that are money motivated and those that appear not to be? What I have seen is that those who seem to be money motivated are living to a much higher standard of living. The things people do with money and the demands people make on their lifestyle are more relevant than the money itself. These things could be private education fro their children, big houses, holidays, barges, Porches, philanthropy, debt, gambling, etc. It’s irrelevant what these things are. What’s relevant, is that having this stuff are basic must-haves. As a result, these must-haves push the money comfort zone so far north that it makes these people look insatiable for cash. The truth is they simply have a much more remote financial comfort zone than the average person.
We can demonstrate the effects of a person’s financial comfort zone as follows. It’s common for salespeople who earn £X to inherit accounts when other salespeople leave the business. This inheritance should mean that they receive twice their usual commission or £2X. This overachievement typically occurs for a few months. Then slowly but surely you see the performance drop and the earnings return to £X. Why does this happen? The answer is quite straightforward. The salesperson was performing beyond their financial comfort zone, and so they simply relax. Customers experience this relaxation as a tail off in customer service or proactive sales calls. Therefore, these clients go elsewhere. The salesperson’s performance in turn declines back to their original financial comfort zone.
Sometimes, you see a different effect. If you sustain the effect of inheritance for a long period, irrespective of the relaxation effect, then the effect of increased income can slowly shift the individual’s financial comfort zone. The shifting of financial comfort zone occurs because the person becomes habituated to the enhanced income. They use the surplus money to buy a bigger home, more expensive car, etc. These purchases increase their monthly costs and push their financial comfort zone further away. Therefore, the inheritance has a lasting effect on the individual’s motivation to earn money
You can see the very same effect above with people who have been lucky enough to receive a significant genetic or environmental advantage. Sometimes, a salesperson finds themselves in a great sales territory or with a great account that performs irrespective of an individual’s sales performance. In these cases, the financials rewards slowly affect the individual’s financial comfort zone in the same way described above. The lasting benefit being an increased inherent motivation to earn money.
But what about traits, competencies, skills and characteristics? Surely these things affect performance and should be sought to get good salespeople? In truth, I believe these are merely hygiene factors. Hygiene factors in the same way you choose a supermarket because its clean, competitively priced and close to your house or place of work. As a salesperson, if you can’t communicate, build relationships, problem solve, execute on your actions and close – then you are not going to struggle, you are going to fail. Not one of these skills or competencies in isolation make the difference. They all have to be there for the person to achieve even average levels of success.
What pushes people to perform is a “do-or-die” need to perform. No other single competence, trait or skill has any similar effect on performance. Let’s say Y is a unit of performance. If a person desires to perform to 10Y but only needs 5Y to reach financial comfort – then 5Y is what you’ll get. There will always be a reason to put off the behaviour that makes 10Y happen until tomorrow. To paraphrase the Rolling Stones, you get what you need and not what you want.
What about competitiveness? Some people need to be number one! It’s true; competitiveness has an effect. For those for whom this is crucial, it can be a great motivator. Many people need to be top of the tribe. Again, this type of motivation has mixed responses. Only a few individuals can be at the top. If you have 100 salespeople, only ten can be top 10 performers. If there are some competitive people throughout the group and climbing through the group is tough due to environmental reasons (and not performance reasons), then these people will quickly become demotivated and potentially leave. Primarily, the company or role cannot fulfil their expectations.
The unfulfilled expectation brings us to another important factor. The second and sometimes overlooked factor is the opportunity. When people believe their employer can provide the opportunity and remuneration to satiate them, they move without restraint towards their financial comfort zone. In other words, do the salespeople believe their efforts will yield the desired results? Few people will act for any length of time in a state of known futility. Lack of perceived opportunity doesn’t mean the salespeople will always leave. The reason is, they are not far away from financial comfort already. They are happy to have a job. It usually means they just exist and perhaps even adjust their monthly costs as opposed to increasing their earnings, and this is can be devastating to productivity and customer experience.
So what does this say to you the reader? I suspect you read this to understand either how to become a better salesperson, how to be a better sales leader or perhaps out of curiosity. I suspect, you are looking for an edge! Perhaps I have disappointed you?
So what can you take away? Quite simply, if you want to perform better, you need to address your financial comfort zone. There can’t be anything contrived here or fake. If you want to earn double, then you have to need to make double. If you don’t receive double, things need to start feeling uncomfortable. In other words, placing a picture of a supercar or a yacht on your monitor achieves nothing. Buying the boat and having to find the money for your first payment (or its repossessed) does. This discomfort creates the appetite for the behaviour that produces high performance. If you want to run like you have a metaphorical cheetah chasing you, you need to have a cheetah chasing you! The cheetah comes first, not the performance!
Richard Wilkins 2015.e a cheetah chasing you! The cheetah comes first, not the performance!
Richard Wilkins 2015.