Five pillars of effective sales management


 Insights & Joy 

September 2015




Helping leaders accelerate profitable growth by enhancing a
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Dick Morgan CMC, FIMC

Five pillars of effective sales management


Sales management needs to be a seamless process from developing a specific job description to ongoing supervision. I identify and describe five pillars of effective sales management, with examples showing how they integrate to form a workable system. 


Job description. Hiring a person first, then writing the job description is poor practice. You first need to understand the specific tasks to be accomplished, how the job fits within the organization, how the person’s accountability will be measured, and some form of time utilization model for the job. With a useful job description, you can then focus on an objective view of each candidate’s experience and attributes against the job.   


Individual performance appraisal. A comprehensive appraisal of performance starts with collaborative goal setting. The individual and the supervisor work together to establish measurable goals for a period of time. The goals measure progress of each major task as described in the job description.

An appraisal should allow for both objective and subjective appraisal areas. For example, objective goals could include sales revenue or profit margin goals by product, along with goals for the number of new customers, cross-selling, upselling, or retention of existing key accounts. Subjective goals might cover internal relationships, cooperative projects, administrative promptness, judgement, or creative thinking. Ratings of individual tasks and measurements of progress can be totaled to provide the individual a clear picture of how they stand in relation to their job and to the goals the incividual previously helped to set.

Another section of the appraisal should concern the individual’s personal development plan. The individual and the supervisor jointly develop ideas and actions aimed at improving the person’s scope, progress, and promotability. Inclusion of a development plan indicates to the individual the organization’s interest in helping people grow.

Finally, the appraisal includes space for the individual to make written comments regarding the appraisal, along with the person’s signature and date of the appraisal. Signing the appraisal simply acknowledges that the individual received the appraisal. Signing does not necessarily mean that the person fully accepts the results of the appraisal. Retaining a signed copy of the appraisal in the individual’s file is contemoraneous proof that the individual was made aware of his or her performance level and any corrective or probationary action being taken.

When used in a collaborative way, periodic appraisals of individual performance can be powerful motivators. One of the major gripes of many employees, especially those in sales and marketing, is that they don’t know where they stand with the boss, or what they need to do to make progress within the organization. Appraisals avoid nasty surprises for employees. Appraisals force supervisors to remain objective and provide developmental help to those who aspire to higher level performance. 


Compensation plan. The third leg of a good sales management system is a compensation plan that rewards each individual based on the level of achievement of mutually established goals. It is folly to establish a compensation plan based on one main task and expect other job-related tasks to be fully accomplished as a matter of course. Poor sales compensation plans base incentive rewards based only on short-term revenue or profit margin results, ignoring the other goals of gaining new customers, selling auxiliary products, introducing products to new markets, etc. My experience tells me that individuals will focus on the task(s) that provide added rewards, and they will expend less effort or ignore tasks aimed at long-term survival of the organization. In a nutshell, if you want a sales representative to juggle five different short-term and long-term tasks, your compensation plan must include the incentives to match those tasks. Whether you pay straight commission, salary plus bonus incentives, or some other combination, you need to ensure reasonable rewards tie to all of the person’s expected tasks.


Hiring process. I am often amazed by the way some managers handle hiring. An opening occurs and they hire the first person who seems to fill the job, sometime based on a single hurried interview. Then, six months later the manager wonders why results are poor. Termination happens, then the manager repeats the same flawed process. The key to successful hiring goes back to looking at the fit between the job description and the individual candidate. Why rush to put an unknown person into the position to screw up a significant portion of the business?

Instead, develop a hiring process that includes multiple interviews of top candidates. Consider using an independent consultant to conduct tests and provide an objective report on how well the candidate fits your job. There will be some upfront expense, but it will not be nearly as much as the cost of a bad hire in the long run.

The hiring process should also include onboarding for the new hire. The new person needs some orientation to the organization, initial training on products, policies, and procedures. Initial formal coaching and mentoring will also help get the new employee off to a positive start. A new person may be baffled by the organization’s culture and will need to absorb a new body of knowledge quickly.


Supervision. Once the new individual has completed the hiring process, the supervisor assumes the role of coach. Coaching becomes an ongoing responsibility, starting with mutual goal setting for the initial appraisal period. The organization may have a probationary period where the individual and the supervisor set short-term objectives and an initial developmental plan. The supervisor brings together the five pillars of effective sales management, job description, hiring process, coaching, performance appraisal, and compensation plan. As results occur, the individual and the supervisor will know where he or she stands in relation to mutually agreed objectives. The basic framework becomes a repeatable system for supervising, rewarding, and developing individuals to achieve greater results for both the individual and the organization. 


“Effective marketing doesn’t take millions. It takes imagination, enthusiasm, and the willingness to experiment and change.”                                                                                                                                                             Richard P. Morgan CMC, FIMC 


$ Million Marketing Tips

Tip: In many cases, you must create the market, overcome apathy or intertia, and get customers to act. If you are first to spur action, you get the business.


Tip: If nobody remarks about your price, it is probably too low. “Setting your price is like setting a screw. A little resistance is a good sign.” Harry Beckwith


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“Dick helped create a comprehensive and successful marketing and sales strategy for a short line railroad bridging from Mexico to Dallas/Fort Worth. Additionally, he provided valuable mentoring to prepare us for sales calls in Mexico and the U.S. His experience allowed us to successfully build new traffic on the line.” 
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Copyright 2015, Morgan Marketing Solutions, Inc.


Richard P. Morgan CMC, FIMC

Morgan Marketing Solutions, Inc.

16814 Park Hill, Dallas, TX 75248-1444

Telephone 972.931.7993

Author, Marketing Facets – The Market-focused Guide to Company Analysis


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