Posted by Jack Derby, Head Coach on Mon, Feb 15, 2010

As everyone knows who reads these posts, in my “spare time”, I teach business planning and marketing as a lecturer at MIT and as a marketing professor at Tufts. I love the work and student involvement, plus it provides an excellent opportunity to integrate concepts into the real world of sales and marketing tactics, both for my students and for our companies at the firm since often they become case studies in the classes.

Even after having done this now for some years, grading students is still a challenge for me.  Do they get an “A”? Maybe it should be an “A-”, possibly a “B+”?  And at Tufts, giving a mark lower than a “B-”, is the academic equivalent of banishment from the campus.  Even with a math-driven formula built into the way I grade, still the awarding of grades, and especially final grades, is an anxiety producing but obviously necessary process.

Just as grading is part of the deal between professor and student, so are performance reviews between sales managers and their salespeople.  One of the key findings that we discovered 10 years ago, and have verified repeatedly in our surveys, is that highly successful salespeople rank themselves not against their quotas, not against their bosses’ requirements, but against other highly successfull salespeople.  Of course, they’re graded every day, week, month and quarter against quota, but the real standard among the “A” players is measuring themselves against one another.

Right now, make a list of your salespeople.  Okay, now grade them with “A”, “A-”, “B+”, and so on.  Be objective and bluntly honest with yourself since this exercise is for your eyes only.  And then sit down and figure out in one or two sentances for each salesperson what are you going to do with each of them during the balance of this quarter to change their grades? 

After you’ve completed the list, the realization that you will have to make is that you don’t have the time or the capabilities of working with every person on the list, so now the real task begins.  Where are you simply not going to invest time because the person is a solid “B+” or “A-” player, and the reality of your own schedule is that you simply do not have the time, and your grading is that the person is “good enough”?   Are you going to put more time into your “A” level players and make them “A+”?  Are you going to try to raise a “B” to a “B+”?   Do not pretend that you’re going to make a “C” into a “B” since it is highly unlikely that that person can do it without extraordinary time from you and most probably from others.   Better to cut your losses and replace the person…and do it quickly. 

Most sales managers incorrectly invest their time into attempting to improve the “C” players and hoping against hope that their efforts are going to be rewarded when in fact they should put their time into the variations of “B” and “A-” players and improve the overall scorecard of their group or the company.  The other management mistake is that of acknowledging that “some revenue is better than no revenue” such that you keep the “C” level performer just because they’re bringing in something.  Unfortunately, the math never works since once quotas continue to slip from “C” and “B-” performers, and then there’s a speed bump, for whatever reason, in one given month for the entire company, the drag caused by the “C” and “B-” players can put the entire month and quarter into a loss.

The management rule of thumb is to always to be in a recruiting mode such that when that next “A” opportunity presents themselves, you simply take that opportunity and remove  your lowest level performers.

A tough reality, but a necessity all the same since we all live by grades.

Good Selling !


Tags: Sales Optimization, sales, sales management, sales effectiveness