sales skills

7 Techniques to Power Your Quarterly Sales

By Robert Youngjohns, President and CEO, Callidus Software Inc.

At the end of each quarter, companies worldwide look at their sales figures and try to figure out what went wrong, and what can be done better going forward. Some will set unreasonably high sales targets, others will plan exciting sales contests, and still others will look to their top sales people and try to figure out how to infuse the same talent into the rest of their sales teams. But by understanding a handful of time-tested and universal sales management principles, any company can increase their chances of sales success – each and every quarter.

I started out selling IBM products to tire manufacturers in the midlands of Britain – thousands of miles from headquarters. The company tried all sorts of different things to motivate the sales team, but checks always spoke far louder than any of my sales managers’ words. In a nutshell, driving greater sales success is mostly about setting clear and simple goals, and delivering financial rewards quickly.

Here are seven tips to help any company achieve and exceed its quarterly sales goals:

Tip #1 – Avoid Goal Vacuum: Set Targets Early
During the time when management is analyzing the past year and working out sales goals for the present one, there’s a goal vacuum, and savvy sales people will often close deals less aggressively to keep from getting too far out in front of their target. Why? Because money is involved, and most serious salespeople want to do what will make them the most money. They will often wait until the company can tell them what the target is before they really get cracking.

So it’s important to communicate sales targets as early as possible every quarter. By simply getting the goals out there, even if they’re still rough and will need to be adjusted, salespeople will have something solid to shoot for, and they’ll start closing deals earlier.

Tip #2 – Don’t Pad the Sales Target
There’s a story of a CEO who attends a company function just days after the company has set its revenue targets for the year. He meets one of his salespeople there, and asks how it’s going.

“Not that great, I’ve been asked to do 40% growth, and there’s no way I’m going to make any money,” responds the account executive.

“I thought our growth target was only 15%,” says the CEO.

What’s wrong with this picture? It turns out that in the average company, as quotas push down through the management ranks, each manager builds a buffer, to make sure that the person below delivers the revenue needed to make the up line manager’s number. Eventually, what started out as reasonable targets are inflated into unrealistic goals, the sales team becomes de-motivated, and the company stagnates.

Instead, keep target allocations as close as you dare to the actual goal. In the end, it’s going to help everyone.

Tip #3 – Keep Goals Simple
Equally important, sales targets, or goals, need to be simple for both executives and the sales team to understand, and easy to measure. If you can’t properly measure sales performance, it’s crazy to put sales force rewards in place, because that investment won’t work toward your overall company goals, and neither will your sales people.

Tip #4 – Cash is King
Cruises, vacations and other prizes are great, but clear cash incentives are the reason we salespeople come to work every day. Good compensation plans lay it out – “if you do this, you’ll get that amount of money”. Cash incentives are the only way to be this exact. The problem with non-cash forms of compensation is that they’re often based on a bell curve of performance, or some other selection process where even if certain goals are accomplished, there’s still only a chance that a sales person will get a particular reward. So think of contests and promotions as fun ways to add to a cash compensation plan, don’t make them a substitute.

Tip #5 – Pay Incentives as Quickly as Possible
Sales managers often make the mistake of outlining too long-term a sales compensation plan, and wait too long to pay their sales teams. It’s better to set short-term goals, and compensate your team regularly, as they reach them. For example, quarterly compensation plans tend to work well – the longest workable time horizon is one year.

While intellectually very attractive and much discussed, long-term goals just don’t work. There are too many variables at play for a person to believe that by slowly executing toward a particular long-term goal, they’ll ever actually reach it.

Tip #6 – Everyone Loves Sales Heroes, But They Don’t Win the War
Sales heroes make great water cooler talk and give everyone something to shoot for – as in, “Did you hear about Joe’s $1 million commission check?” These success stories keep the sales team motivated, and give them something to aspire to. But the making of a sales star is as often about luck or timing as it is about hard cold personal performance. In many cases, territory, timing and customer factors outside any individual’s control are as responsible for large orders and big commissions as are the talents of the salesperson.

Top sales managers know that in addition to the 10% of the sales stars who command the limelight, it’s really the other 90% of the sales force who fight the good fight day in and day out, and who are actually responsible for winning the war. It can be easy to perceive that it’s the heroes that save the day, but in almost all cases, it’s the rest of the team that gets the job done. So don’t ignore the rank and file.

People are always quick to say that the quarterback won the game, but in most cases, it’s probably not true – in all likelihood, without his team, he would have gotten rolled over.

Tip #7 – A Bit of Theater to Get Everyone on Board with the Plan
There’s an age-old battle between executives and sales teams when it’s time to review sales targets and results, but it can be prevented with one theatrical, but powerful step. When goals are missed, management says the sales force doesn’t ‘get it’ or isn’t motivated, and the sales team says the products aren’t any good. To keep people from passing the buck, just circulate the compensation plan, and get each executive to personally sign it, and voila, no more excuses.


Mandatory Reading: The 4 Types of IT Department Software Buyers

By Steve W. Martin, Sales Author, “Heavy Hitter Sales Wisdom: Proven Sales Warfare Strategies”

If you are involved in selling an enterprise software solution, you already know the importance of understanding the inner workings of the various departments within the prospective customer’s company. Your software might be purchased by the Information Technology Department and used by Accounting and Human Resources. It might be selected by Engineering (with the IT Department’s help) and used by Manufacturing. Or it could be selected by Finance and bought by the IT Department. Almost every enterprise software purchase decision requires multiple departments to become involved. Therefore, it’s critical to map out the interrelationships of the departments within an organization.

Over the past five years, I have performed win-loss sales analysis studies for a wide variety of software companies ranging from start-ups to companies with sales over a billion. To complete these studies, I conducted blind surveys of the senior IT executives, mid-level managers and low-level technical evaluators who had selected or rejected the software from the company for which I was completing the study. While the purpose of these studies was to improve the sales force’s effectiveness, interesting patterns of IT organization behavior became apparent. These patterns supersede the standard hierarchical organization chart that salespeople and marketers have grown accustomed to studying.

Four models can be used to define the information technology’s departmental interrelationships that will influence their buying behavior: Departments can either be consolidators, consulters, responders, or bureaucrats.

The four IT departmental types (consolidators, consulters, responders and bureaucrats) have different orientations toward the operation of their departments. Most importantly, they buy software in different ways and for completely different purposes. It is important to understand that any department can be any type of buyer. For example, the IT Department may be a consolidator at one company and a consulter at the next. Sometimes, the type of department may be associated with a specific business goal. For example, the IT Department may be a consolidator when driving a project to complete Sarbanes-Oxley compliance and a responder when asked to assemble information for a sales department–driven project.

Consolidators are IT Departments that seek to increase their power, authority, or control within their organization. To grow their sphere of influence, they launch grand initiatives, major company-wide projects that affect the operations of other departments.

The planning and creation of a grand initiative are at the direction of the department’s executive leadership (CIO, CTO and VP of IT). This type of project does not percolate up from lower-level personnel through the chain of command; it is driven down from the top and out to the rest of the company.

The figure below illustrates a consolidator’s flow of power. In this example, the Vice President of Information Technology has decided to drive an initiative to move all applications and programs off the company’s aging mainframe computers onto new, less expensive computer systems. After making this executive decision, he mandates that his direct managers fulfill his wishes. These direct reports assemble teams to plan the project and evaluate the vendors. IT liaisons (who report back to the information technology department) gather information from the various departments, schedule vendor demonstrations with departmental power users, and serve as intermediaries between the various departments during project implementation.

The underlying motivation behind grand initiatives like this one is always power, whether it’s to gain more, consolidate it, or decrease that of other leaders and their departments within the organization. In the example above, the Information Technology Department is exercising its power over Engineering and Finance. Sometimes a grand initiative is an executive-level coup, an internal revolution intended to change the way the company operates. Many times, it is a well-orchestrated conspiracy in the guise of a logical business project. Other times, it is an act of revenge against an intercompany archenemy.

Consolidators are typically a software salesperson’s dream because they have the propensity to make things happen. ‘Big-bang consolidators’ tend to buy all the software and services they need to complete a grand initiative all at once. ‘Cautious consolidators,’ on the other hand, purchase the products and services they need piecemeal, taking one small step at a time in order to prove their project’s success.

Consulters are IT Departments that take on the characteristics and attributes of a consultant to their organization. They seek to understand the problems of other departments and offer recommendations on how those problems can be solved using their services.

They proactively share their proprietary knowledge and departmental expertise or offer unsolicited advice to other departments in an attempt to show how they can improve efficiency. Therefore, they are continually polling the other departments, seeking opportunities to promote their services, and pushing out their ideas, philosophies and opinions.

Consulters are more prevalent in massive multibillion-dollar companies (like the auto and insurance industries) than in smaller organizations. They are less powerful than consolidators and achieve their desired outcomes through finesse rather than brute force.

The figure below shows the information flow of a consulter IT Department. In this example, the Information Technology Department is constantly polling the business units for their needs and pushing out information they believe is beneficial.

For example, an IT Liaison (department intermediary) may seek out and meet with the Vice President of Sales, who expresses his dissatisfaction with the timeliness of the sales forecasting system. The Liaison takes this information back to his department, and it traverses up the chain of command to where a decision is made to investigate new sales forecasting solutions. Conversely, a Liaison may hear about an exciting new technology that aids manufacturing from the chief technology officer. The Liaison schedules a meeting with the technology vendor to learn more information. He then sets meetings with ‘power users’ in the Manufacturing Department to explain how the new technology may improve their operations.

Like a consultant hired on an hourly basis, consulters seek to continually validate their benefits and justify their existence to their customers. Selling to consulters differs from selling to consolidators because consulters enjoy the company of other consultants.

Responders are weak IT Departments that operate under the direction of other departments. Whereas consolidators seek power and consulters seek to proliferate their services, responders are just trying to survive. Many times, IT responders are literally under attack from other departments that are unable to meet their objectives because of the IT department’s ineffectiveness. In some cases, other departments have been disappointed by the past IT blunders. As a result, IT responders tend to be treated disrespectfully and suffer from a lack of departmental esteem.

The figure below illustrates the power flow of a responder. In this example, the IT Department is the whipping boy of Finance and Engineering, constantly enduring those departments’ criticisms. Important power users within the finance organization complain to management that their needs aren’t being met. In turn, senior executives dictate their needs to midlevel managers, who relay the message to IT liaisons. In this instance, the IT liaisons’ main goal is to run interference on behalf of the IT Department, sorting out the most important requests while trying to maintain a semblance of departmental decorum. For issues of extreme importance and urgency, senior executives of a business unit will call their counterparts in IT directly and tell them to get something done. The power is clearly on the business unit side.

When selling to a responder, you must sell to the business unit as well as IT, whereas with consulters and consolidators, your main sales effort should be directed inside IT Departments. For example, let’s assume a powerful Accounting Department at a company is complaining about escalating phone costs and your company provides phone bill audit software. You need to make both the business unit (accounting department) and the responder (IT Department) aware of your services.

The final category of IT departmental buyer are bureaucrats, faceless departments whose most important priority is to maintain the status quo through rules, regulations and delaying tactics. The features of a Bureaucrat Department are secretiveness, a response system that reflexively rebuffs demands made upon the department, and administrative centralization around the departmental leader, the arch-bureaucrat.

The structured environment, similar to a military command-and-control environment, stamps out innovative thinking within lower levels of the department and hinders the free flow of information from other departments. Instead, the bureaucratic monarchy considers other departments outsiders and issues edicts that must be complied with for fear of consequences.

The figure below illustrates the shield that bureaucratic buyers erect around their IT department. In this example, the IT Department dictates to the Manufacturing Department what products it will use (because of pre-existing standards). Meanwhile, the Engineering Department’s recommendation is rejected, even though it is in the best interest of the company.

Because IT executive leaders of consolidators, consulters, responders and bureaucrats have different motivations, they have different perceptions of a product’s true value. The perceived value of a product depends on the psychological, political, operational and strategic value it provides the executive decision makers.

Every enterprise software sale involves consolidators, consulters, responders and bureaucrats. You must determine a project’s wellspring in order to know to whom and how to sell your software solution. For example, at one company, every employee had to undergo ergonomics training on the proper way to use their desktop computers. Based on just this information, you might assume that the driver behind this company-wide initiative was the IT Department and that it was a consolidator. However, the IT Department was actually a consulter, working on this project at the direction of the finance department (the real consolidator). The Finance Department had instigated this project so that the company would qualify for reduced insurance premium rates. And, the essence of successful enterprise software sales is understanding not only who to sell to, but how to craft a message that appeals to consolidators, consulters, responders, and bureaucrats.

Try to Impress Your Prospect: Lose the Sale

By Paul McCord, President, McCord Training

Knowledge should be one of the most powerful tools in our toolbox.

Knowing how to use specialized industry vocabularies should also be one of our basic and power tools.

In reality, for many of us, knowledge and specialized lingo are powerful—in costing us business.

Naturally a great many new salespeople are tempted to try to impress prospects and clients by demonstrating their product knowledge and slinging their newly learned industry vocabulary around. They tend to oversell, answer questions no prospect has ever had, dazzle with words the prospect and client may not be familiar with. They talk about the fine points of their product or service; discuss how their service or product will impact ROI; how best to onboard new employees or products or services; how their product or service creates a new paradigm to address the prospect’s issues or needs; and the list goes on.

Impact ROI? I see, you mean whether or not it makes me more money than it costs. Onboarding new employees or products or services? I get it, you mean purchasing and integrating a new product or service or hiring and orienting a new employee. Creating a new paradigm to address issues or needs? You mean a different way of dealing with the problem, right?

You can say ROI, onboarding, or paradigm, or you could just talk to your prospect. Some say that if you want credibility with your prospects and clients you have to speak their language. I don’t have a problem with that in the least—if you’re actually speaking your prospect’s language. But how many prospects actually talk about onboarding a new product or service or creating a new paradigm to address an issue or problem? And there’s certainly something to be said about just talking to the prospect in plain English.

And very often new sellers butcher their newly acquired vocabulary and confound and frustrate their prospects with their enthusiastic demonstration of their knowledge of the minutiae of their product or service. Many lose more sales than they capture because of their lack of discipline and their need to impress.

Unfortunately I’ve noticed over the past three years that this desire to impress isn’t confined to new sellers. I consistently run across experienced sellers who should know better that are making the same rookie mistakes. The only real difference between these experienced sellers and new salespeople is experienced sellers tend to have a better grasp of the industry lingo.

In the current tough selling environment even experienced sellers are falling into the trap of trying to oversell and to impress with their knowledge and ‘deep’ understanding of the prospect’s issues. We tend to pull out all the stops and often end up losing our discipline and the prospect’s attention. We try to force the sale.

Rather than creating new clients, we end up alienating them.

Whether you’re a relatively new seller bursting with enthusiasm and wanting to impress your prospects or an experienced seller feeling the pressure to produce, you need to step back and relax. Giving in to the pressure to oversell and force the sale is self defeating. Address your prospect’s needs and leave the unnecessary demonstration of knowledge and the impressive vocabulary at the office.