Creating A Structure For Sales Success

by | June 5, 2014

Blog written by Michelle Bomberger, Equinox Business Law Group.

As business confidence increases, many companies are looking for sales people.  Yet when you talk with business owners, finding a successful sales person is very tough.   The skills required to be successful are not always obvious. What you hear in an interview may sound great, but how do you really gauge whether they can produce results for your business in your industry?

There are a lot of tools in the marketplace to help you identify whether a candidate has the attributes to be a good sales person for your business.  For example, the Core Values Index offered by Taylor Protocols and the Salesperson Candidate Assessment tool offered by ACME Sales Development.   Whether you use them as the first step in the evaluation of a candidate or after you think you’ve found the right person, these tools provide an objective approach to looking at a candidate.  They balance the subjective “likeable” factor with some more objective data.  Most of us have experienced the effects of hiring someone we really liked without any results.

Once you find the “right” person, be careful with the structure and incentives you provide, and make sure to capture these items in the employee offer letter and the employment contract.  These must be in line with the actions you want them to take and the objectives you want them to achieve.  The default compensation in sales is a salary plus commission structure.  This works in many cases for individuals whose primary job is to go out and find customers or work.  But should their commissions be nuanced further?  I have heard the terms “hunter” and “gatherer” used to define finding new customers compared with gathering additional business from current customers.  You may want a different compensation structure for these activities.  In addition, compensation may differ based on the certain client characteristics.  The commission for a larger customer or a longer term customer may be higher than a smaller customer.  Keep in mind who you are trying to reach and compensate your sales team accordingly to incent the right behaviors.

Don’t forget that many members of your team are involved in the sales process, not only the front line sales person.  Consider the involvement of these individuals in the sales process – maybe they can take more proactive steps to close a deal quickly – and determine if a sales-like compensation may be appropriate for them.  Similarly, if growth is an objective, maybe you structure a bonus for everyone based on overall company sales or profit.   These incentives only drive behavior and have impact, though,  if the individual feels they can affect the outcome, so a thoughtful approach is needed.

Finally, remember that incentives and compensation must connect with the company’s overall culture. The sales people and compensation structure you put in place should reflect the values of the business.  More importantly, it should not conflict with the company’s culture.  If you talk about honesty, professionalism, and loyalty, your sales program should also reflect these values.   If not, the disconnect will be apparent to everyone because the behaviors encouraged by the program will be out of line with the messaging of the company.  Remember also, that compensation can change.  Don’t feel stuck to a compensation plan that isn’t working; on the flip side, don’t get talked into a higher commission for someone who’s not the right person to do the job.

The right sales folks are out there but you have to invest in the tools necessary to find them and carefully craft an incentive program that fits your business.  Document the plan and objectives and monitor the activities and success.  You can’t guarantee a “win” every time, but you can create systems that increase your chances of success.