Editor Choice : May 2006

Ultimate Motivation Guide: Happy Sales Force, Happy Returns

Everyone knows motivated employees mean a stronger bottom line. So why are you leaving rewards and recognition on the management backburner? A comprehensive philosophy of team motivation can spark ideas for fueling everyone's fire

On a harried sales manager's to-do list, "take Joe to lunch for closing the deal" might lie just below "water the office plant." If, that is, the thank-you lunch makes it to the list at all. It's not because managers don't recognize the importance of motivation. But in between managing a pipeline and putting out fires, they find little time for planning rewards or recognition.

But there's danger in overlooking the role of motivation in sales success. According to research by the Forum Corporation, a Boston-based learning solutions consultancy, companies with higher "motivational climate" scores tend to record higher sales performance. That's not so shocking. But what is surprising is that "the manager—the one person most in-touch with salespeople day to day—often is overlooked by the C-suite in creating a motivational climate," says Ron Koprowski, the head of Forum's sales training practice. "Lots of research says a person's immediate boss is key in retention. Sales managers represent the company, so the day-to-day climate is essential."

Creating this climate doesn't have to involve an incentive-program overhaul. Koprowski points out that "the pat on the back in front of peers and sharing best practices is big." That means even informal efforts can go a long way.

Don Cates, president of AmericanTrust Federal Savings Bank based in Peru, Indiana, says giving and getting feedback is key to motivating his staffers. "Our biggest challenge is our frontline people understanding how important they are," he says. "We discuss big-picture issues with them, and even though there may not be current advancement opportunities, they can still advance themselves through additional experience and training." Also key: AmericanTrust conducts job-satisfaction surveys, and follows through with feedback.

"Invest the time to uncover what is truly important to your staff in order to improve performance and align their efforts with the company's vision and direction," says Keith Rosen, head of Profit Builders, a sales-coaching firm based in Merrick, New York.

Encourage Top Players

Strangely, it might be hardest to find out what is most important to your superstars. Your top performers, the stars, present a great challenge in how to maintain their motivation. They've been at the top for so long that there may be burnout to contend with, and perhaps even a surfeit of prior rewards. At Sales & Marketing Management's 2005 Chief Sales Executive Forum last October, leading heads of sales looked as though they already had it figured out.

"We have a President's Club, a major recognition program, where 18 percent of the top performers go away on a five-day, four-night trip to the top resorts around the world, and we've done that for probably 30 years," says Michael Mac Donald, president, global accounts and marketing operations at Xerox Corporation. "And no matter whatever happened at Xerox, it's something that we've never touched."

Elsewhere, companies find that spousal programs are important.

"We call our top program our Achievers Trip," says Thomas Kendra, executive vice president, sales and services for Symantec Corporation. "In addition, we've started quarterly recognition programs, in the last couple of years, where our geography leader takes ten to fifteen people with spouses on a two- or three-day leadership-type event to thank them. So, while the annual event is what people are all working toward, the quarterly gets the more immediate recognition and employee gratification going."

"The distinction between incentive programs and recognition programs is a fine and nearly transparent line, but there are some basic rules of thumb that help distinguish the applications of each. Recognition programs are usually longer term (a year or more) and are designed to sustain behavior that the organization deems commendable in order to help reach specific corporate goals. Incentive programs tend to be shorter (a year or less) and should help change behavior in order to help reach specific goals. Sales recognition programs are generally used to focus attention on the 'big picture' (hit your overall numbers), while incentives concentrate on individual elements within the picture (quarterly goals, new product sales and training, spurts, etc.). They can be used in conjunction with each other and, to truly judge their impact, should be both attainable and measurable."

— Ric James, national director of marketing, TQ3Navigant Performance Group, Englewood, Colorado

Companies also are finding means of rewarding more than just excellent end-of-term production. Accelerating that production is another big goal of superstar-mindful managers.

"For the last couple of years, to put some excitement into making goals in the Americas earlier, individuals who made their full-year quota by the end of the first half [were given] a $50,000 automobile or boat," Kendra says.

However the top achievers are rewarded, they have to be identified first. Not only is that essential to the fairness and integrity of any incentive program, but it can be a motivating activity in itself.

"We've had a Samurai Society at Sony for many years, and that's the best of the best," says Stan Glasgow, president of consumer sales at Sony Electronics Inc. "It's more than just sales. It's about character and how things get done. And if you can get elected to that it's very lucrative for you. The supervisor has to promote you to the next level, and it has to be written up with documentation; a presentation has to be made by the supervisor to a committee. If you're going to really make the society tight, you've got to make the selection rigorous."

"As hard as salespeople work, behind the scenes there are the sales assistants sending information out to prospects, fielding calls, and setting up appointments. You don't have to send the support staff to Puerto Rico, but how about a gift card that allows them to choose a special gift for themselves, or a hotel certificate for a night in any city and dinner for two? Make a splash, recognize the support staff in front of their peers, and they'll be more motivated during the next sales cycle to help your star achievers."

—Bill Termini, vice president, domestic and global sales, Hinda Incentives, Chicago

Reward Perpetual Striving

Motivating your top performers is a no-brainer, but that alone won't increase your bottom line. Your B players—those who may not perform at the top level, but who perform consistently—are significant contributors who shouldn't be overlooked, says Rodger Stotz, vice president and managing consultant for Maritz Inc., a provider of reward and recognition programs based in St. Louis.

But midlevel performers thrive when they've got something to work toward, and unfortunately, many companies are overlooking rewards programs to motivate them. According to a survey by Maritz, 52 percent of respondents who qualify for incentive programs—which typically reward only the top 10 percent of workers—feel they have only somewhat or no chance of winning an award.

"Most sales compensation plans are set up to motivate [through] pleasure. The more you sell, the more you make. This works well for lots of salespeople. But what happens when you no longer 'need' money? The more evolved salesperson will be motivated intrinsically, from within. Carrots and sticks don't work as well here. What drives this salesperson might be a commitment to excellence, the desire to provide something for their family, to make a contribution to their community, or just the joy of doing a job well and expressing their gifts. The focus of the manager becomes creating the environment where individuals feel empowered to make their highest contribution."

—Siobhan Murphy, president, Quest Coaching International, Long Island, New York

Stotz gives this example to show why managers must recognize and reward those B players: Ten percent of a company's sales force may be A players, while 80 percent are B players. If you get the A players to improve by 20 percent, then overall results climb 2 percent. But if you get just 5 percent more out of your mid-level performers, overall results will go up 4 percent. "Studies say that well-designed sales incentive programs do increase performance," Stotz says. "Ask your B players what their impression is of the current recognition and reward plans. They may think, 'I can't try because I can't make it,' when it comes to top-performer incentive programs. That is just demotivating."

"In today's competitive environment, there are many ways to sabotage your efforts. Here's what not to do:

• Don't confuse incentives with recognition. Incentives are designed to motivate changes in behavior. Recognition relates to rewarding those changes in behavior, if and when achieved.

• Don't create goals in a vacuum. Work with individuals and team to create clearly defined, measurable goals; make sure everyone is on board with expectations.

• Don't target your efforts to just your top performers. Motivate the
middle. Structure your incentive program so that it's open-ended and on an individual basis so that everyone has a chance to win.

• Don't forget to communicate. Track progress. Let participants know how they're doing, and how their competition is doing.

• Don't forget to publicly recognize the winners when the program is over, as well as provide a tangible representation of their achievements."

—Glen Holbert, director of sales, Marketing Innovators, Rosemont, Illinois

So what can you do to make sure you're motivating the bulk of your sales force? Stotz offers the following suggestions:

• Be clear on your objectives. "Instead of only using top-performer measures, such as most volume, create an incentive for the most improved, which will attract the Bs," he says.

• Promote the plan. Sometimes executives "launch a program, but participants don't know they're in the program—that's not good," Stotz says. "Keep 'em well informed of all the programs they're eligible for," he says.

• Stay involved. The sales manager's role is critical in any type of incentive program. Salespeople are independent, but they look to managers for direction. Encouragement, program promotion, and progress reports can go a long way in getting the most from a motivational program.

• Set up personal bests. Work with B players to set up individual goals for achievement and recognition. This can get them out of a rut and improve their performances.

• Create a mentor program. "If it is within the culture, look to A players to mentor the Bs," Stotz says. "They can offer 'tips from the top' class sessions, for example, once a month. Sharing tips for success motivates the Bs."