The new collaborative selling environment demands innovative ways of measuring performance, setting targets and designing incentive plans. Performance targets, incentive plans and performance measures cannot be considered in isolation as they are highly interrelated, recent research from CRANFIELD SCHOOL OF MANAGEMENT has found.

Cranfield today (2 December) unveiled a new framework designed to support organisations in the target-setting process. Called the ‘Cranfield target-setting wheel’ it aims to help businesses ‘transform their existing performance management and incentive systems to reflect the sales environment that staff operate in and establish targets that will generate the expected behaviours’.

Troubled part-nationalised bank, the Royal Bank of Scotland admits that it is losing salespeople and other key staff and has been paying guaranteed bonuses this year in an attempt to attract top talent. These are just some of the issues raised in a wide-ranging interview with RBS chief executive STEPHEN HESTER on Channel 4 News on 9 November.

Royal Bank of Scotland posted a pre-tax loss of Ł2.2billion for the July to September quarter with so-called ‘impairment losses’ down 30% from Ł4.7 billion the previous quarter. The bank has also written off another Ł3.3billion in bad debts and other bad investments. It says conditions remain ‘fragile’.

Channel 4 News’ reporter John Sparks talked to Hester in the light of last week’s interim figures and Tuesday’s news that revised participation in a state-backed asset insurance plan will see UK tax-payers’ holding rise to 84%.

What can sales leaders learn about motivation from the world of sports, asks Fiona Challis.

In the world of sports, teams have a coach to provide motivation, inspiration, enhance their skills and help them achieve peak performance. Similarly, in the world of business, sales teams look to their leader or manager to provide motivation, inspiration, enhance their skills and help them to achieve peak performance.

Similarities

Successful sports teams and successful sales team actually have a lot of similarities. They both need focus, they have shared goals and vision, and individuals within the team have their own personal goals which they take positive action towards achieving everyday.

These individuals take responsibility for their own success; however, they have the ability to work together as a team. They have a leader who provides inspiration and coaches them to recognise their strengths and identify the motivational drivers which they can utilise on a daily basis to sustain their motivation. It is all of these elements which enable both sports teams and sales teams to achieve peak performance.

Executive director of P&MM Events & Communications, Nigel Cooper offers his view on why cutting back on incentives now will prove to be a hostage to fortune later.

In a recession, cutting costs is an essential business priority, always has been, always will be. It’s rule No1 in the economic handbook. However, equally, if not more important, is rule No 2 – how are you going to get out of it?

It’s time to ask yourself some serious questions about your sales strategy.

How appropriate for April Fools Day! City office workers reportedly waved Ł10 notes to taunt G20 protesters as thousands descended on London’s financial heartland.

Environmentalists, anarchists, anti-war protesters and workers hit by the financial crisis congregated around the Bank of England to demand action from world leaders on what some protesters have dubbed ‘Financial Fools Day’. Meanwhile, bankers leaning out of windows taunted demonstrators on the streets below, who responded with jeers and shouts. (Not sure the ‘loadsa money’ joke is still appropriate – Ed.)

Death threats and multi-million dollar lawsuits – just some of the consequences of a poorly conceived or ill-managed bonus scheme. Editor Nick de Cent explores the relatively new discipline of sales compensation management.

There’s no doubt that the subject of bonuses provokes strong emotions. I doubt that there’s a pub in the land that hasn’t played host to an argument about the rights and wrongs of Fred the Shred’s (that’s Sir Fred the Shred to you – Ed!) high-rolling lifestyle during his tenure as chief executive of Royal Bank of Scotland.

Sir Fred Goodwin’s house in Edinburgh was recently vandalised: windows were smashed at his Ł3m villa in the Morningside area of the city, as were the windows of a Ł100,000 Mercedes S600 parked in the driveway. Sir Fred, who recently took his children out of their private school over fears of bullying, is believed to be in Spain with his family and is said to be ‘shaken’ by news of the attack.

World-class sales organisations don’t just do one or two things well; they do everything better. The most successful organisations maintain a high level of performance across all of the selling and sales management activities required to support the sales process.

That’s one of the major conclusions of Miller Heiman’s latest benchmark survey which saw almost 4,000 sales professionals contribute to its sixth annual study of the trends, issues and opportunities in a complex selling environment. The 2009 Sales Best Practices Study focuses on the selling and sales management activities that have the greatest impact on producing results.

Although the Oscars are better known, if you want to experience an awards event which is a truly great inspiration for the whole team, indeed an entire profession, you don’t have to look further than the National Sales Awards, writes ModernSelling.com publisher, sales director and category judge Neil Warren.

Creating high-performance sales teams is essential for any business wanting to achieve sales growth: proactive, positive, consistent, new-business-winning teams and salespeople are the holy grail of any sales organisation, writes GAVIN INGHAM.

As managers we all have our own unique ways of motivating, managing and leading our sales teams yet, from time to time, we also have problems keeping our teams on target, focused and ‘up for it’. Here are five of the most effective motivational strategies and techniques that I have used to help many of my clients to achieve their personal, team and business goals.

Pity the poor comedian, apparently called Stanley McHale (not exactly a household name, then – Ed?) whose unfortunate job it was last night (12 February) to warm up a Royal Lancaster Hotel banqueting room packed to the gunnels with expectant salespeople, writes Nick de Cent.

The trouble was the audience didn’t need warming up; they were at it full tilt already; intent on partying their way through an evening which would see awards in 13 categories presented to top achievers, managers and other luminaries from the world of selling. Yes, it was BESMA night – the British Excellence in Sales Marketing Awards – when the lucky winners and runners-up (known as rising stars) would receive the recognition of their peers, friends and colleagues as the culmination of a year of hard work.

One can only assume that McHale didn’t know what he was letting himself in for when he agreed to open the evening. The trouble was, he made the cardinal mistake of not understanding his audience, but worse, he wasn’t even remotely funny.

Luckily, Institute of Sales and Marketing Management chairman Sheila Watson-Challis exercised her right as hostess for the evening to cut the unfortunate McHale short. If she hadn’t, blood would have been spilled.

Commission schemes are on of the most emotive aspects of a salesperson’s business life: how they’re structured determines take-home pay and bonuses and can be a powerful motivational force in driving the team forward.

John Stuart of OpenSymmetry looks at the complex political processes involved in optimising sales force commission plans and explains how to keep sales, HR and finance all happy.

Money is said to be the biggest motivator in sales. The formula seems simple enough: if you want your sales personnel to perform, you offer them the right incentives.

But who decides what these ‘right incentives’ are and how commission plans should be set up in order to make sure sales efforts push in the right direction and are in line with the overall company strategy?

Hot debate

More often than not, the team responsible for sales compensation find themselves in the middle of a regular and hot debate about company restructures and which director should take control. Trust is often called into question at this time as sales commissions for large organisations can extend into the millions-of-pounds bracket.

Director of business development at OpenSymmetry, John Stuart argues there is scope for up to a 12% saving on sales force compensation plans.

I recently read a story about a customer who went into a shop to buy a pair of shoes. After deciding which pair he wanted, he went to the till. Half way there, one of the sales assistants handed him shoe polish, saying that it was free that day.

At home, the proud new shoe owner checked his receipt, only to discover that he had in fact paid for the shoe polish but received a discount on the shoes in turn.

So why had the sales assistant said the shoe polish was free? What had probably happened was that the shoe polish offered the highest profit margins, so the retailer incentivised its sales staff to drive the shoe polish sales.

The problems caused by a lack of visibility into incentives and their unintended consequences are currently all around us, says Callidus Software chief executive officer, Leslie Stretch.

We see one financial institution after another succumb to an untimely, but ultimately avoidable, demise. This is due to an incentive culture that rewarded excessive, short-term risk taking and ignored the long-term financial consequences. Staff were incentivised heavily to hit short-term targets, such as in the sub-prime mortgage market, without taking account of future risks to banks’ balance sheets.

In all this turmoil it isn’t clear exactly what the UK government can and will do to rein in incentives beyond attacking the ‘fat cat’ culture in the City itself. The Financial Services Authority has said that it will look at banks’ reward and incentive frameworks, including taking this information into assessments of how much capital banks need to guard against exposure to potential losses. This will clearly take time to implement, meaning that banks need to act now to be in position to better manage their incentive programmes.

However, this is just one facet of the market’s inability to get a hold on managing the sales force and their actions. On a day-to-day, basis too many organisations don’t have a clear grasp of what their sales teams are doing, leading to missed opportunities, a failure to hit targets and regulatory and legal challenges.

Professional Sales Development Ltd founder, Stephen Lewis-Brammer explains how to keep selling in the current tough economic climate.

Doom and gloom! At least that is what they are saying in the newspapers and on the television and, if you are not careful, it may be what you will be thinking too.

Before you go into your own version of a depression, though, here is a positive thought for you to contemplate: cometh the tough times, cometh the hour of the professional salesperson.

Rather than being something which we should all be worrying and panicking about, tough times really present a golden opportunity for you as a professional salesperson to prove your worth – while it may be more difficult to win business it is possible. In fact, tough times are actually professional salespeople’s opportunity to remain consistently successful (even to increase their levels of success) whilst lesser mortals around them fall by the wayside.

Fired one too many paint-balls? Bored with lame problem-solving exercises? Don’t worry! We sent Tina Lofthouse in seach of ten events that will really get the team fired up.

Team-building – the very thought strikes fear into the heart of normally co-operative and positive employees. Hours spent in muddy fields scrambling over obstacle courses, making robots with sticky-backed plastic, and that old chestnut – working out how to get your team across a ‘minefield’ (more muddy grass!) with just the aid of two short planks.

Fortunately, it doesn’t have to be this way. Events companies are becoming extremely innovative when it comes to team-building, ensuring that the day not only ticks all the boxes in terms of improving communication, bonding, and so on, but is – shock, horror! – actually good fun.

Road warrior – the very name conjures up the essence of life in field sales: isolated, wandering, battling against the odds, but with the added spice of romance, a hint of riches and glory at journey’s end. Nick de Cent gets inside the head of a salesperson.

When we refer to salespeople as ‘road warriors’, is it a term of endearment or a put-down? Are salespeople today’s equivalent of the knights of the round table or are they selfish, needy, isolated attention-seekers, as quick to sell their grandmother for a couple of quid as to help out a client? What it is that attracts people to the sales profession and drives them on in the face of continual rejection?

Misunderstood

One thing’s for sure: salespeople and the sales process are much misunderstood, and the traditional view of what makes salespeople tick is neither accurate nor up to date. And of course there are many different types of salespeople, working in varied roles, across different industries: business development, account management, field sales, telesales, ‘hunters’, ‘farmers’ – the list goes on.

What really keeps a salesperson motivated, asks editor Nick de Cent?

There must have been more words expended on the topic of motivation in business – and especially in sales – than almost any other, along with enough hot air to fuel the Greenhouse Effect well into the next millennium.

Type in the word ‘motivation’ and Google returns over 87 million references, a large proportion of which turn out to be from the usual suspects – self-styled motivational gurus, peddlers of the latest quick fix and similar snake-oil salesmen – all intent on earning their over-inflated consultancy fees.

Director of Sales Team Focus Ltd, Jeffrey Bean discusses whether sales team motivation is measurable and predictable.

I recently read an excellent article written by Nick de Cent (originally in Salestarget.co.uk’s newsletter ‘The Deal’ and onsite here – Ed) that accurately summarised the collective thinking on the motivation of employees in general and salespeople in particular, into which serious research began in the early 1950s.

Reality of the situation

Whilst the conclusion and recommendations may have seemed like catch-alls, they reflect the reality of the situation in that no two people are motivated by the same things and in the same way. And what motivates an individual can vary over time depending on personal circumstances.

What use are such generalisations to sales managers seeking to recruit the ‘right’ people and get the best from every member of the team? Well, whilst it is true that we are all unique in terms of precisely what motivates us, there is a surprising amount of commonality in what motivates high-performing salespeople. The best news of all is that it’s measurable and predictable – of great benefit when recruiting new staff.

1 Identify your objectives.

Without a clear idea of what we really want from our career (and life in general) it can be extremely difficult to stay focused and motivated. Work out the difference between dreams and fantasies. The pay rise we have been promised or the promotion that has been hinted at are both dreams. It is easy to lose touch with our dreams under the pressures of daily life.

2 Make those goals realistic.

We often sabotage the things we really want to achieve by taking on too much. Above all, set realistic goals.

Managing work-load and expectations in today’s frenetic business world is a challenging but vital skill. Where possible, it is almost always more productive to take things at a steady pace.

We talk a lot about motivation in the world of sales, so much so that a multi-million-pound industry has grown up around the concept of keeping employees – and especially sales staff – motivated. But what about the opposite – demotivation?

What demotivates?

Systems, organisational policies and management actions can all actively contribute towards a demotivated workforce.

Of the three, it’s probably the individual manager’s actions and behaviour that has the greatest immediate effect on staff motivation… or lack of it.

Here are seven ways you can guarantee to demotivate staff…

When it comes to pumping up performance, many businesses are looking to provide the thrill of a lifetime. Just don’t tell Health & Safety, says journalist Tina Lofthouse.

There is plenty of evidence that travel incentives are far more appealing than cash in the sales world but, with people travelling more than ever before and holidaying in increasingly far-flung destinations, a way of offering something that bit more special is becoming crucial.

'Good news chaps, we're all going paintballing!' I don't think so, says Peter Buhlmann, not when there are so many more imaginative ways to lead your team towards motivational Nirvana.

1. Strip cold-calling

Not the idle fantasy of a fourteen year-old comic aficionado, but a technique used by Pareto Law, voted the best small company to work for in the 2005 Sunday Times national survey.

'We only take on inexperienced young graduates,' says sales manager Matthew Hague, 'so we have to think how we're going to provide a business that they're going to want to work for. We've tended to sail a little close to the wind sometimes and do something different.