Only lousy salespeople miss their targets?

As the year ends and a new one begins, those of us in sales roles will have our performance measured against an annual sales target. 

If they meet their target, they will feel happy. A bonus might be in the offing. If they don't, they may look forward to their annual review with trepidation.

So it's easy for sales managers to judge salespeople. Good salespeople hit their targets, lousy ones don't. Or do they?

Success or failure depends on many factors:

- What is the demand in each sales territory?

- What is a salesperson's ability to generate new opportunities?

- Are they spending time on the right projects?

- Can they push those projects over the finish line?

Demand is variable and uneven. Each sales territory may have a bias towards a particular industry. For example, for a sales rep in Boston, the state of the pharmaceutical industry is critical to success; for one in Aberdeen, the goal may be unattainable if the oil industry is flagging.

Sales managers can only assess their sales force if they understand the characteristics of their territories.

Prospecting, or generating new opportunities, is particularly important in difficult economic times. Not every salesperson is equally adept at it. Typically, however, prospecting is much more successful when supported by lead generation from the marketing department. Cold calling may not be the best use of a salesperson's time.

Assessing a salesperson's prospecting skills requires an understanding of some key metrics, such as new opportunity generation, lead-to-opportunity conversion, ratio of new customer business, and progress in penetrating target accounts.

Perhaps the biggest lever for sales success is prioritisation. Time is limited, there are only 220 working days a year, some of which are taken up with training, administration, meetings, etc. Time spent on opportunities that are unlikely to convert into orders is lost forever. "Flogging a dead horse" is a very English expression for wasting effort on a lost cause, which is unfortunately not uncommon in sales, especially when business is slow.

How healthy and clean is a salesperson's sales funnel? Are they ruthlessly eliminating old, non-converting opportunities? Is the CRM up to date?

Closing is another skill where salespeople vary. Some find it easy to ask for the business, perhaps even with a smile? Others fear the decisiveness of a definitive answer. Closing is much easier when opportunities are well qualified. Who is involved in the decision? What is the timetable? Is there an allocated budget? Is the project a clear need or a nice to have?

To assess a salesperson's closing skills, we should know how they qualify opportunities. What questions do they ask, what information do they gather?

So only lousy salespeople miss the mark? Maybe not. But good sales managers look at more than just target attainment.

Good sales managers will look at market trends and geographic specifics. They analyse lead generation by territory, lead to opportunity conversions and opportunity age.

Good sales leaders know what the CRM looks like for each of their salespeople and whether opportunities are well qualified.

Good sales leaders know their salespeople's strengths and weaknesses long before the annual review and help them build on their strengths and work to improve their weaknesses.

Good sales leaders go on joint visits and see their salespeople in action

Good sales leaders have a multi-year perspective and already know whether the salesperson is good or bad based on all the criteria above. Regardless of target achievement.