Performance Management Friday — Balanced Performance
As sales people, we may be responsible for a lot of different things—we may have a number of product lines we can sell, we may have responsibility for retaining and growing current customers, as well as acquiring new customers. There may be a number of different strategic objectives our company may have for us.
However, sometimes, we get stuck in a rut–we have our favorite product lines–the one or two products we know very well, those that we have had great success in selling. Or we are stuck calling on the same customers–people who we know, customers with whom we have great familiarity.
While we are comfortable with certain product lines or customers, it creates real problems for us and our companies. Great sales people continually look for balanced performance. They try to sell the entire product line. They try to balance the results they produce between acquiring new customers and growing the relationships with existing customers.
When we fall into bad habits, we limit our ability to be successful. If we just sell our favorite products, we’ll miss opportunities to expand wallet share (we’ll cover this in another post) with our current customers. We’ll miss the ability to find new customers–they may not be interested in our “pet product lines” but may be interested in other product lines.
When we focus on our favorite customer, not acquiring new customers, we miss many new sales opportunities—leaving them for our customers.
Balanced performance is critical to our companies. To support new product development and extension of the product lines, and the execution of the company’s strategies.
It’s easy to fall into bad habits–we have the product lines we’ve been most successful with, so we look for more of those opportunities, we have the customers we’ve been most successful with, and keep calling on them. Sometimes when companies have been merged, we see this happening—we sell the products from our former company, and are slow to pick up the products from the new company. Or our company announces new producst–but we aren’t comfortagle in selling them, so they languish. There are all sorts of other reasons we may fall into those bad habits.
Make sure you balance your performance:
1. Look at the opportunities in your funnel, are they dominated by a few product lines, or is there a good mix of opportunities across all the product lines you are responsible for. If more than 70%* of the opportunities are from one product line, you may be missing a lot of sales opportunities.
2. Look at the opportunities in your funnel and the balance between new and current customers. Unless your territory assignment is strictly new customer focused or current customer focused (for example, covering a few key accounts), make sure you have a good balance across new customer acquisition and current customer growth. Consider roughly a 50-50* split.
As a manager, making sure your people have balanced performance is very important. Think of this, from the point of view of executing the company’s strategies. is a sales person that makes their quota with a balanced performance in selling all the product lines and acquiring new customer a better performer than a sales person who makes their number with just a few customers or by focusing only on one or two product lines. Tactically, we like the revenue performance from both, but strategically, the sales person with balanced performance is contributing much more.
Set goals for your people, set goals for new customer acquisition, set goals–maybe guidelines for balanced performance, don’t get too detailed or prescriptive, but look at performance across major product categories. Keep coaching your people about the importance of balanced performance, not just from the point of view of the company, but from their point of view–having more to sell to more customers is always helpful when we are trying to fill our pipelines?
Take a few minutes this weekend and look at your funnels:
1. Do one or two product lines dominate the opportunities you are pursuing?
2. If so, what are you going to do to look for opportunities with other product lines?
3. Have you looked at your current customers and how you can sell them more of your product portfolio?
3. Are you going back to the same customers all the time? What percent of the opportunities you are pursuing are from potentially new customers?
4. Look at your territory, what are you doing to go after new customers?
* There’s nothing magic about these numbers, choose whatever might be appropriate for you.
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