Many sales managers regard performance reviews as a ghastly task. The process has such a bad reputation, it's regular fodder for corporation-lampooning comic strip Dilbert. In one scene from the comic, the boss in Dilbert's world says to employee Alice, "Good news, Alice. I'm going to have quarterly performance reviews to boost morale."
Alice's reply: "Wow! In addition to working 16 hours a day in this big box, now I'll get 300 percent more criticism."
Though evaluations may seem to be more job than joy, the task is a vital part of managing a sales team. In fact, Dick Grote, author of The Performance Appraisal Question and Answer Book (AMACOM), suggests performance appraisals "can be the most important tool in the sales manager's arsenal to develop a high-performing, totally committed sales team." Perhaps because the process is so daunting, Grote explains that too often the sales manager "squanders the chance to build sales excellence because of a lack of courage to tell people the truth about how they're doing."
Get in the habit of praising performers and weeding out dead weight by using the following guidelines to firm up your review process.
- Elements of a review: Each appraisal should include such quantitative measures as total sales, sales vs. quota, client presentations per day and week, sales per week and month, and close rate. As quotas are a large element of a review, it's important to understand how your reps view the system. "If the quota was handed down from on high, the salesperson doesn't identify with it, feels it's unfair and has a hard time meeting the quota," warns Steve Savage. Savage, president of Savage International, a sales and marketing consulting firm based in Nashua, New Hampshire, believes a quota system is powerful only if the salesperson worked with his or her manager to develop it.
- Beyond quotas: After the quantitative measures are covered, Grote encourages managers to focus on the more qualitative aspects of selling, including "impact and influence" and "achievement orientation." Grote describes impact and influence as behaviors that include building networks, seeking advice and using group process to lead or influence the group. Achievement orientation manifests itself as taking initiative, doing more than asked and looking for problems to fix.
- Frequency: Reviews should be done on a regularly scheduled basis. A newbie should be reviewed more frequently at first, and then at least every three months. "Normal reviews must be conducted quarterly," says Bill Blades, president of William Blades LLC, a sales and leadership company in Scottsdale, Arizona. Blades adds that managers should allow enough time to prepare and conduct each review. "Most chiefs don't do either of these functions very well. It's not time lost, it's time well-invested."
- Good news, bad news: Your sales force may dread reviews as much as you do. "When it's done with enthusiasm and optimism, it's a powerful motivating tool," says Savage. "Compliments should be lavish, and criticism should be fair, calm, supportive and constructive."
One of the reasons reviews lurk at the nadir of your to-do list is that there may be bad news to deliver. If a rep isn't selling, Grote suggests an entrepreneur do the thorny work of firing. "Don't undertake the burden of improvement-think replacement," says Grote. "Managers tend to wait way too long to fire obvious losers."
Blade concurs with that position on firing: "The only thing worse than [too much] turnover is none when there should be."
Kimberly L. McCall is president of McCall Media & Marketing Inc. (www.marketingangel.com), a business communications company in Freeport, Maine.